Are they also designing products with FETs and plastic packages? Because those are things their competitors are way ahead on as well.
You have that exactly backwards. The way Su added cash is not sustainable except by continually reducing production and dumping unsold inventory. AMD is contracting rapidly.
AMD shareholders lost a lot more than a penny of company this quarter.
The question is how did they gain $100M in cash when they didn't have that much in income, not even in non-GAAP operating income, and report no change in debts?
The only way it works is if inventory levels are significantly decreased. Which means they're buying fewer chips than they're selling (for once) and selling them at or below cost, so they book revenue and no income, but convert inventory to cash. Which means they had to dump chips to make even the 22% lower revenue number they had.
It also means their costs are going to go way up, and margins are going to go down, because the lower manufacturing volume goes in semiconductors, the more each wafer costs and the lower yields go.
The lowered revenue projections for Q1 may be an understatement, as well. If Su is cutting production to avoid inventory writeoffs in the future, it's only good for that. Annual revenues will suffer, though, and the people who have been basing their bets on Price/Sales are going to walk away. AMD will shrink itself to micro-cap size.
AMD pumpers have no integrity, and they are cowards.
Absolutely. Hector's suicidal race to the bottom on price to get his executive bonus (which was insanely based on market share instead of investor value) took an iffy company and turned it into a flaming wreck that is still falling from the sky.
It will be impacting the rocky surface of whatever planet these idiot pumpers come from, soon enough.
It would still be overvalued by 100% of its market valuation at that point.
Inventory adjustment is not a one-time thing for AMD. AMD's business model is built on telling that lie. AMD can't make parts that sell in enough quantity to justify the prices it gets from the fabs, so it orders too many, knowing it can claim breakeven on operations then play the one-time loss game with the chips it knows it has to throw away.
Likewise, expect the severance charges to become a consistent expense. This company has to contract to keep its last nostril above the lava.
It's run out of Sea Micros to write off. But if it's carrying any goodwill (and it claimed 550 million last Q and Sea Micro would only have cut that by less than half) you can expect to see that being written off in the future as well.
There is no honest accounting model under which this company can be said to be looking at an actual profit in the next year. None.
Not to worry. It's been restocked in all the roadside kiosks leading to and from AMD HQ.
That was the result of losing all the BitCoin-mining sales, plus the learning curve on the consoles, plus various and sundry underperforming "design wins" and competitive beat-downs.
That was what they saw coming last summer, and what Rory told them he had no answer for.
Could have sworn that was Thoreau. At any rate, good quote. Yes. AMD longs will soon be riding the rails, living off the land, and getting chased out of town by the Sheriff on a regular basis.
All pumpers admitting they made a mistake supporting this company in 2014 can admit it here without fear.
Any pumpers denying it will be shellacked.
They acquired you as a fan. Worst mistake AMD ever made.
Not big enough. Had to be over $500 million. There's more pain from Rory's tenure to be accounted for, yet. This will hit Q1, too.
The market is expecting a disaster. The parabolic decline since last Wednesday is a sign.
Your guess is better than the masochist's.