U.S. Markets close in 6 hrs 13 mins

Why AMD’s Newest Ryzen Chips Landed With a Dud

Aaron Pressman

Advanced Micro Devices on Friday unveiled the second generation update to its groundbreaking Ryzen chips for personal computers, but unlike last year’s initial debut, the reception so far has been muted at best.

The new chips, available for pre-order immediately and arriving on Apr. 19, are faster and cheaper than last year’s models. But AMD didn’t disclose any new hardware features, performance tests, or comparison benchmarks to chips from archrival , which just released a host of new, faster processors of its own. Shares of AMD, which have been volatile in 2018, lost almost 2% to $9.92 in midday trading on Friday. The shares are down 19% over the past year.

The slump reflects AMD’s difficult challenge competing with Intel in the CPU market and in the graphics chip market. Despite AMD CEO Lisa Su’s strategy to abandon older designs and develop all new, groundbreaking chips with Ryzen for PCs, the Epyc chip for servers, and the Vega line for graphics, the company is still having difficulty catching its much larger peers. Intel blunted some of AMD’s momentum by adding an “i9” high-performance chip to its line up that had topped out with the “i7.” And Nvidia is still dominating selling graphics chips into the booming market in cloud data centers that run machine learning and artificial intelligence tasks. Investors also have concerns about possibly volatile sales related to digital currency mining and a deal Su struck with Intel for combined CPU and graphics chips. The defection of AMD’s lead graphic designer, Raja Kudori, to Intel in November probably didn’t help assuage investors, either.

Get Data Sheet, Fortune’s technology newsletter.

On the surface, AMD had a strong year in 2017. Sales rose 25% to $5.3 billion and Su managed to turn a 60 cents per share loss in 2016 into a modest 4 cents-a-share profit. But AMD gained only a few percentage points of market share against Intel and investors had been hoping to see profit margins and earnings per share improve more quickly, too.

It was a little over a year ago that AMD’s long-depressed stock price rose above $12 a share for the first time since 2007. The huge gain--the stock had been as low as $1.83 in 2016--reflected investor enthusiasm for Su’s strategy. But after peaking at almost $16 per share last July, investors have largely been disappointed in AMD’s results and concerned about the cryptocurrency factor.

Analysts haven’t been able to figure out exactly how much of AMD’s sales strength last year was due to the rise of digital currency mining. Groups that “mine” ethereum and several other major cryptocurrencies by crunching transaction records for new coin rewards have relied on graphics chips from AMD and Nvidia . As the price of the currencies rose last year, the groups had incentives to devote ever greater computing resources to their mining efforts. But lately, digital currency prices have crashed to earth and graphics chip sales could suffer.

The new AMD chips announced on Friday go on sale Apr. 19. The top of the line Ryzen 2700X, which will sell for $329, has 8 processing cores and runs at a top speed of 4.3 GHz. That compares to last year’s similar Ryzen 1800X which also had 8 cores, a top speed of 4 GHz, but sold for $500 when it debuted.

AMD said it would release more details, including performance comparisons, on Apr. 19. The new chips are manufactured at a scale of 12 nanometers, down from 14 nm for last year’s Ryzen line, which should make them more energy efficient and higher performing.

See original article on Fortune.com

More from Fortune.com

  • Nokia in Q3 2018: Why Analysts Are Estimating Lower
    Finance
    Market Realist

    Nokia in Q3 2018: Why Analysts Are Estimating Lower

    Nokia (NOK) is expected to announce its third-quarter earnings on October 25. Analysts expect revenue of $6.4 billion compared to $6.46 billion in Q3 2017, indicating a year-over-year decline of 1%. Revenues for Ericsson (ERIC) and Juniper Networks (JNPR) are expected to fall 4.2% and 6.5%, respectively, in their current quarters.

  • Business
    Barrons.com

    The Black Hole Inside General Electric

    RBC Capital Markets, Wolfe Research, and (BCS) all upgraded the shares this month after Larry Culp was named to replace John Flannery at the helm. Today, the Financial Times reported that GE Power was going to win a contract in Iraq over rival (SIE) (SIEGY). Wolfe analyst Nigel Coe wrote that could help turn investor sentiment on GE, noting that the struggles in GE Power are what drives most of the negative feelings toward the stock.

  • Investors seem to be balking at MoviePass' parents' plans to reverse split its stock again — and for good reason (HMNY)
    Business
    Business Insider

    Investors seem to be balking at MoviePass' parents' plans to reverse split its stock again — and for good reason (HMNY)

    Helios and Matheson, the parent company of MoviePass, is seeking to boost its share price through another reverse-split of its stock. Two of the major research firms that offer investors advice on shareholder votes back the reverse-split proposal. Sometimes investors have a much better sense of what's in their best interest than the executives in charge of the companies they own or the advisors who get paid to tell them how to vote on company issues.

  • Employee Accused of Urinating on Production Line at Food Processing Facility
    Business
    WTKR - Norfolk

    Employee Accused of Urinating on Production Line at Food Processing Facility

    Smithfield Foods, Inc. said in a statement Tuesday that it disposed of more than 50,000 pounds of product after reports of an employee urinating at his station at the company’s processing facility in Virginia.

  • Kinder Morgan Beats Q3 Earnings Estimates, Improves Leverage
    Finance
    Market Realist

    Kinder Morgan Beats Q3 Earnings Estimates, Improves Leverage

    Kinder Morgan Beats Q3 Earnings Estimates, Improves Leverage Kinder Morgan’s third-quarter results Kinder Morgan (KMI) announced its third-quarter results on October 17 after the markets closed. The company announced an adjusted EPS of $0.21—up ~40%

  • Alipay Hacking Comes at Sensitive Moment for Alibaba
    Finance
    Market Realist

    Alipay Hacking Comes at Sensitive Moment for Alibaba

    Hackers broke into the accounts of Alipay users and made off with an unknown amount of cash, according to Bloomberg. The hackers used stolen Apple identities to carry out the theft. Tencent (TCEHY) also reported theft of funds from its mobile payment app WePay, also called WeChat Pay, where stolen Apple identities were involved.

  • What Intel’s Low Relative Strength Index Means for Investors
    Finance
    Market Realist

    What Intel’s Low Relative Strength Index Means for Investors

    The stock market has been volatile in October. Intel (INTC) and Nvidia (NVDA) stocks fell below their 200-day moving averages in the latest stock market sell-off, which was triggered by the Fed’s interest rate hike. On October 11, Intel’s traded volume was 43 million, which is well above its three-month average daily volume of 24.75 million.

  • 'It's Not a Republican Problem.' Mitch McConnell Blames Entitlements for Rising U.S. Deficits
    Politics
    Fortune

    'It's Not a Republican Problem.' Mitch McConnell Blames Entitlements for Rising U.S. Deficits

    Senate Majority Leader Mitch McConnell on Tuesday blamed rising federal deficits and debt on a bipartisan unwillingness to contain spending on Medicare, Medicaid and Social Security, and said he sees little chance of a major deficit reduction deal while Republicans control Congress and the White House. “It’s disappointing but it’s not a Republican problem,” McConnell said in an interview with Bloomberg News when asked about the rising deficits and debt.

  • Business
    CNBC

    Walmart saves $200 million by changing its light bulbs and $20 million with a new floor wax

    Walmart says switching to LED lights in its parking lots cut its annual energy costs by $200 million. A change in the floor wax it uses cut costs by $20 million a year because the floors need to be buffed less often. It's exactly what Walmart WMT is doing.

  • Finance
    Investopedia

    5 Chip Stocks Facing Steeper Declines Ahead

    The PHLX Semiconductor Index (SOX) is down by 9.2% since a recent intraday high on Aug. 8, and Morgan Stanley sees more trouble ahead, per a report in Barron's. Back in 2015, chip stocks endured a decline of 30% from peak to trough, and the fundamentals

  • Finance
    Investopedia

    Berkshire Is Undervalued, Says JPMorgan

    Berkshire Hathaway Inc.'s ( BRK.B) Class B shares are cheap if you apply the same metrics that its CEO Warren Buffett does to value companies, according to JPMorgan. In a research note, reported on by CNBC, analyst Sarah DeWitt said Berkshire, a company that investors have historically struggled to value properly because of its many moving parts, suddenly appears to be attractively priced when factoring in all the profits made by the stocks held in its $200 billion equity portfolio into its earnings. “Look-through earnings” take into account current period earnings that show up in financial statements, together with other sources of earnings expected in the long run. This method is used by Buffett as a way to appreciate that companies sometimes retain earnings after paying dividends and later invest them at a higher rate of return.

  • A former GE exec who trained new managers found that almost all of them were making the same mistake
    Business
    Business Insider

    A former GE exec who trained new managers found that almost all of them were making the same mistake

    Beth Comstock is the former vice chair of General Electric. Comstock would hand out "permission slips" authorizing employees to take risks — but she also said it's important for people to stop hiding behind their excuses. Beth Comstock doesn't tolerate excuses.

  • Lockheed’s ballistic missile defense system clears another hurdle
    Finance
    American City Business Journals

    Lockheed’s ballistic missile defense system clears another hurdle

    Lockheed Martin Corp. said Tuesday it had reached a key technical milestone with a new missile defense system. The company’s Long Range Discrimination Radar, known as LRDR, completed what’s called a closed-loop satellite track — successfully searching for, acquiring and tracking numerous satellites across their entire field of view and processing the data using its tactical software and back-end signal processing equipment. What that means is that Bethesda-based Lockheed (NYSE: LMT), the world’s largest defense contractor, has designed and produced a scaled LRDR system that is running with the actual processing equipment and software (featuring more than 3 million lines of code).

  • Trump: Stormy Daniels, Michael Avenatti must pay my legal fees
    News
    Fox Business Videos

    Trump: Stormy Daniels, Michael Avenatti must pay my legal fees

    President Trump says he expects Stormy Daniels and her lawyer, Michael Avenatti, to abide by a judge’s ruling to pay his legal fees. The full interview will air on "Trish Regan Primetime" at 8 p.m. ET on the FOX Business Network.

  • Why American Airlines Group Stock Jumped 6% -- Then Gave Most of It Back
    Business
    Motley Fool

    Why American Airlines Group Stock Jumped 6% -- Then Gave Most of It Back

    Shares of American Airlines Group (NASDAQ: AAL) popped 6.4% in early trading Wednesday before retracting to close the day up less than 1% -- just 0.9%, to be precise. An upgrade assigned to the stock by Deutsche Bank appears to be the primary reason for the move. A Deutsche Bank analyst upgraded American Airlines stock from "hold" to "buy" on Wednesday, as we're told by our friends at StreetInsider.com.

  • Pfizer Offers Early Retirement to U.S. Employees Ahead of Layoffs
    Business
    Fortune

    Pfizer Offers Early Retirement to U.S. Employees Ahead of Layoffs

    Pfizer is offering U.S. employees early retirement ahead of company cuts that will hit around 2% of its 90,000 workers worldwide, CNBC reports. In an internal message to employees Tuesday, the company said the layoffs are a part of restructuring that aims to “simplify the organization to avoid duplication, create single points of accountability and reduce the number of layers within teams,” the New York Business Journal reports. “As we prepare for growth we are creating a simpler more efficient structure which will affect some managerial roles and responsibilities,” a Pfizer spokeswoman told CBNC.

  • New York AG Is Opening a Probe Into MoviePass Parent Helios
    Business
    Bloomberg

    New York AG Is Opening a Probe Into MoviePass Parent Helios

    The investigation into parent company Helios & Matheson Analytics Inc. by New York Attorney General Barbara Underwood was opened under the state’s powerful Martin Act, said the person, who asked not to be identified because the information is private. “We look forward to the opportunity to demonstrate that to the New York Attorney General.” CNBC reported the probe earlier Wednesday.

  • Netflix is ditching freeloaders from subscriber forecasts after volatile stock moves
    News
    MarketWatch

    Netflix is ditching freeloaders from subscriber forecasts after volatile stock moves

    After two consecutive off-the-mark quarters, falling short of its own forecasts for subscriber growth, Netflix Inc. hopes to put an end to the big swings in its stock price with some changes to its accounting. In kicking off tech’s earnings season Tuesday, Netflix (NFLX)reported better-than-expected subscriber growth in the quarter, leading to an 11% jump in its shares in after-hours trading. Three months ago, Netflix reported weaker-than-expected subscriber growth, sending its stock tumbling about 12% in the next trading day.

  • Exxon Mobil bets big on China LNG, sidesteps trade war
    Business
    Reuters

    Exxon Mobil bets big on China LNG, sidesteps trade war

    Exxon Mobil Corp is placing big bets on China's soaring liquefied natural gas (LNG) demand, coupling multi-billion dollar production projects around the world with its first mainland storage and distribution outlet. Its gas strategy is moving on two tracks: expanding output of the super-cooled gas in places such as Papua New Guinea and Mozambique, and creating demand for those supplies in China by opening Exxon's first import and storage hub, according to an Exxon manager and people briefed on the company's plans. "China's natural gas demand is rising really fast, with imports soaring well over 10 percent annually at the moment because of the government gasification program and due to fast rising industrial demand, including in petrochemicals," the Exxon manager said.

  • Facebook under fire as US officials back removal of Zuckerberg as chairman
    Business
    The Telegraph

    Facebook under fire as US officials back removal of Zuckerberg as chairman

    Mark Zuckerberg came under fresh pressure after four US officials called for a boardroom shakeup at Facebook. Three state treasurers and a top official from New York have joined a shareholders’ motion to install an independent chairman at Facebook, claiming the move would improve governance and accountability. In June, Boston-based Trillium Asset Management, which holds $11m in Facebook shares, launched an effort to split the role of chairman and chief executive at Facebook following scandals over the hacking of personal data from millions of users and claims of hate speech and election-rigging.

  • Why Winnebago Stock Surged 17% -- Then Gave Most of It Back
    Business
    Motley Fool

    Why Winnebago Stock Surged 17% -- Then Gave Most of It Back

    Shares of RV-maker Winnebago Industries (NYSE: WGO) leapt 17.6% in early trading after the company reported earnings Wednesday, before retreating to a more recent price up just 5% from yesterday's close. For its fiscal fourth quarter of 2018, Winnebago reported $0.94 per share in earnings, exceeding expectations for $0.86, on sales of $536.2 million. Motorhome sales slowed, but towables were a bright spot for Winnebago in Q4.

  • Business
    Benzinga

    A Preview Of Bank Of New York Mellon's Q3 Earnings

    Bank of New York Mellon (NYSE: BK) releases its next round of earnings this Thursday. Get the latest predictions in Benzinga's essential guide to the company's Q3 earnings report. Earnings and Revenue Bank of New York Mellon EPS is expected to be around

  • Ken Langone: 'Who the hell in their right frame of mind would be buying bonds now?'
    Business
    Yahoo Finance

    Ken Langone: 'Who the hell in their right frame of mind would be buying bonds now?'

    Billionaire investor and philanthropist Ken Langone, the founder of The Home Depot (HD) and chairman of Invemed Associates, argued that there’s some “big time” structural problems in the market right now. Because if we are on a trajectory of raising rates that means, and if it keeps going that way and I don’t know how high it will go, and it keeps going that way then all the sudden the guy who bought those bonds is going to be looking at a fairly decent loss,” Langone said.

  • Finance
    Investopedia

    Procter & Gamble Reports Earnings With Negative Chart

    The Procter & Gamble Company ( PG) is a multi-national and a component of the Dow Jones Industrial Average. Procter & Gamble stock closed Wednesday at $81.86, down 10.9% year to date and in correction territory at 11% below its 2018 high of $91.92 set on Jan. 2. Procter & Gamble shares are underperforming the Dow 30, which is up 4% year to date and is 4.6% below its all-time high of 26,951.81 set on Oct. 3.

  • Alibaba (BABA) Dips More Than Broader Markets: What You Should Know
    Finance
    Zacks

    Alibaba (BABA) Dips More Than Broader Markets: What You Should Know

    Investors will be hoping for strength from BABA as it approaches its next earnings release, which is expected to be November 2, 2018. On that day, BABA is projected to report earnings of $1.16 per share, which would represent a year-over-year decline of 10.08%. Investors should also note any recent changes to analyst estimates for BABA.