AMD's quarterly earnings report - operating loss of 49 million and net loss of 102 million USD

[spartaman64]

Actually likely not.  If AMD goes bust, Intel and nVidia will be fine so long as they don't abuse their market position.  Intel has pretty much been a monopoly for performance CPUS since the flop of Bulldozer.  If AMD goes up in flames - they'll have their assets cannibalized by Intel and nVidia.  nVidia would likely be snatching up their CPU division and negotiating a license with Intel and Intel would be consuming the Radeon Technologies Group and finally be getting in to the dedicated market like they've been wanting to.  Which would mean they'd go for the kill against one another and we'd see glorious innovation and competition for control of the market.  The streets would run with turquoise-colored blood.

intel changed the agreement so that the x86 license wont transfer and i think they did that for a reason 

[spartaman64]

AMD fucked up rebadging the last 2 generations of cards then not pulling their socks up with the CPU market. A lot of stuff has been done wrong with AMD and I really hope things change when Zen launches because if not intel will keep bringing chips out with 2-5% more performance with massive price hikes.

not really as the card they rebadged beat their nvidia counter parts 

[SurvivorNVL]

intel changed the agreement so that the x86 license wont transfer and i think they did that for a reason 

They'd negotiate with a size-able amount of money on nVidia's front.  They'd have to.

[SurvivorNVL]

-snip-

Nvidia is an American company.  I'd be more excited to see what Intel can do with Radeon.  Get some industrial looking GPUs with skulls on 'em.

[Nena Trinity]

Nvidia is an American company.  I'd be more excited to see what Intel can do with Radeon.  Get some industrial looking GPUs with skulls on 'em.

I was sure it was Chinese well if so it will work!

[SurvivorNVL]

I was sure it was Chinese well if so it will work!

Yep!  It will work rather well.  Intel would probably toss nVidia the X86 license in return for AMD64, which nVidia would likely gobble up as they take control the CPU divsion, and then Intel doesn't really have to share anything when they take hold of Radeon.  Then they just have to go for the kill against one another and we get to reap the rewards of their competition.

[Nena Trinity]

Yep!  It will work rather well.  Intel would probably toss nVidia the X86 license in return for AMD64, which nVidia would likely gobble up as they take control the CPU divsion, and then Intel doesn't really have to share anything when they take hold of Radeon.  Then they just have to go for the kill against one another and we get to reap the rewards of their competition.

Yay Intel Radeon & Nvidia FX!

[VanayadGaming]

As an investor this is great news. We can see the trend that the operating loss is getting smaller and smaller. Anyone who invested in a company doesn't care that this Quarter will be a loss or not. It cares about the trend and ROI over a longer period. This shows that the company will slowly bust steadily make a profit eventually in the next few years. And that is perfect. 

[SurvivorNVL]

Yay Intel Radeon & Nvidia FX!

They'd likely name it different.  Nvidia likes their Tegra stuff, so they'd probably use something similar to that for their CPUs.  Intel--I can't even imagine.  Their naming schemes are all over the place.  Lakes, Cores, Xeons, Landing, Itanium.  Never know what it could be!

[Nena Trinity]

They'd likely name it different.  Nvidia likes their Tegra stuff, so they'd probably use something similar to that for their CPUs.  Intel--I can't even imagine.  Their naming schemes are all over the place.  Lakes, Cores, Xeons, Landing, Itanium.  Never know what it could be!

They better keep the names or else! >:c

[VanayadGaming]

buying AMD would be like playing the lottery with your entire savings account

what happens with our brand new ZEN and Polaris if AMD goes under - U'r fckd! no matter MicroSoft phasing you out, AMD will do it for them 

I don't know why you cast such a negative light on this Quarterly report. It shows improvement, not regressions. This is great. You cannot expect a company becoming profitable over night. Probably in 1-2-3 Quarters it will be profitable again going at this rate!

[patrick3027]

they'll do fine but what i'm worried about is the generation after that.

Exactly, they are so focused on Zen that they have no plan after that.

That's a whole different position than Intel who's got a roadmap until 2022.

[zMeul]

I don't know why you cast such a negative light on this Quarterly report. It shows improvement, not regressions. This is great. You cannot expect a company becoming profitable over night. Probably in 1-2-3 Quarters it will be profitable again going at this rate!

AMD isn't profitable since how long?!

and mind you, AMD still has to cross "the desert" - 1/2 half on 2016 will be brutal

I suspect AMD will do more "restructuring" - to be read: firing more people

[TorqueS]

I don't find this surprising at all, I mean AMD has been in a hole for the  last few years.

And because people are still buying the brand and not the product, the 300 series didn't sell as good as we would have expected, even if it's on par with nVidia's 900 series and have some added features and better compute power.

 

As zMeul said above, the first half of 2016 will be a journey. I suppose that people are waiting for Zen, Polaris and Pascal in order to decide further upgrades, so I expect the sales to drop considerably and not just for AMD.

[Mr_Troll]

if u compare those numbers to the q3 2015 results... where they had an operating loss of 158 milion and and net loss of 198 milion.... and compared to q1 2015 with 130 mil  operating and 330 mil net loss....they are getting better actually .... i wouldnt call 42 mil and 100 mil loss a big deal like zmeul does.... amd was way worse in 2014 then it is now...

[Elapo]

That's because it is a game that uses Nvidia's sw and takes advantage of the technology that benefits their cards over AMD's.

You can turn off all GW effect in those games.

And even in non-GW titles, AMD doesn't manage to get a big enough lead (if any at all) to where we can say "hey, you know, get an AMD because it's MUCH better". The 980Ti and the Fury X have the same price in Belgium, but why would anyone go through the hassle of using that AIO thing that might not even fit because you already have an AIO for your CPU, or even because your case is too small.

They lost when they decided not to allow custom fury X coolers. Meanwhile the 980Ti is getting a billion versions with custom PCB's, better power delivery and all that great stuff. It's a fucking high end card, why would you not have custom PCB's (and yes, I'm aware the titan X doesn't have custom coolers either, and yes, the same applies there, but Nvidia has another card with nearly the same performance whereas AMD does not)

[Prysin]

Yes, and Nvidia sold A LOT of 970's.

 

 

Also you do realize that there is no way AMD makes more money selling 390's with 8gb of VRAM and their massive cores than Nvidia selling their tiny more expensive 970's.

actually, that depends.

the two 390s versions are based on the Hawaii core, which is nearly 3 years old. the two 380 versions are based on the R9 285 and R9 m295, both of which has been in production for some time.

Now, the irony is that the longer a product is produced (up until a point), the better margins you get.

why?

Because over time, manufacturing costs go down (due to mass bulk orders and the fab not needing to rebuild its production lines over and over. Because THAT costs a LOT. So once the fab has covered their own cost of investing into new equipment. They lower their prices slightly).

Once you have covered the cost of the initial R&D, then you can keep the MSRP as it is, but with the R&D "paid down", you are left with raw margins. R&D is actually a notable part of the product cost.

Also, over time, the fabrication process is refined, this leads to higher yields (much higher), which in turn reduces losses. (broken chips are broken. you still gotta pay for the fabrication of those though. less broken stuff = more stuff to sell).

Also assembly is cheaper over time, as you will be able to optimize the process.

Shipping costs go down once you optimize the distribution and supply system.

Marketing gets cheaper, as an established well functioning product is easier to convince customers buying, then a product that is brand new with new technology (and sometimes untested)

The DIE size does matter indeed, however with a much more refined system, higher yields mean less losses. Intitial production of large dies are very costly (see> Fury X) for a company. However once you get the production going, the fabrication optimized then they doesnt cost more then the added silicone.

A silicone wafer is rather inexpensive for these huge corporations. say you get 50 Nvidia chips off a wafer, and 30 AMD chips... the cost of an extra wafer for AMD to make 50 chips is minimal. Like super super tiny.

As for the memory. Seems like they are using Elpida memory, which is a subsection of Micron it seems.

As for price per chip. seems like AMDs chips are around 9bucks a piece, whilst Nvidias 7GB/s chips are 11 bucks a piece. Nvidia uses Elpida, Hynix and Samsung memory, whilst AMD sticks to Elpida only it seems, although other partners may use other suppliers of memory.

So yes, AMD uses more chips then Nvidia does. However Nvidia almost always uses faster chips. and faster chips costs more. There is also the wildcard of single source of memory causing you to have lower prices (special exclusive deals). We do not know that, and i cannot find any evidence for or against this being the case with AMD and Elpida/Micron. If it is, then it would not surprise me if AMD has so "good" prices that they almost match Nvidia in cost of the memory.

After all, why would AMD choose to go with 8GB if it was not worth it? They may do weird business desicions, but contrary to what some of you think, the people in charge arent THAT stupid.

As for the operating loss.

wasnt that loss something like 2-300 million last year???

I mean, if you somehow get 100 million dollars LESS operating loss IN A YEAR. that is impressive. Sure you lose money, but if they keep this up, they will return to profitability within 2016-2017... that alone is REALLY well done.

[VanayadGaming]

Exactly what @Prysin said! 
 

They managed to decrease the losses tremendously. If they keep that up they will be profitable this year maybe. Especially after the Q when the GPUs release. 

[don_svetlio]

actually, that depends.

the two 390s versions are based on the Hawaii core, which is nearly 3 years old. the two 380 versions are based on the R9 285 and R9 m295, both of which has been in production for some time.

Now, the irony is that the longer a product is produced (up until a point), the better margins you get.

why?

Because over time, manufacturing costs go down (due to mass bulk orders and the fab not needing to rebuild its production lines over and over. Because THAT costs a LOT. So once the fab has covered their own cost of investing into new equipment. They lower their prices slightly).

Once you have covered the cost of the initial R&D, then you can keep the MSRP as it is, but with the R&D "paid down", you are left with raw margins. R&D is actually a notable part of the product cost.

Also, over time, the fabrication process is refined, this leads to higher yields (much higher), which in turn reduces losses. (broken chips are broken. you still gotta pay for the fabrication of those though. less broken stuff = more stuff to sell).

Also assembly is cheaper over time, as you will be able to optimize the process.

Shipping costs go down once you optimize the distribution and supply system.

Marketing gets cheaper, as an established well functioning product is easier to convince customers buying, then a product that is brand new with new technology (and sometimes untested)

The DIE size does matter indeed, however with a much more refined system, higher yields mean less losses. Intitial production of large dies are very costly (see> Fury X) for a company. However once you get the production going, the fabrication optimized then they doesnt cost more then the added silicone.

A silicone wafer is rather inexpensive for these huge corporations. say you get 50 Nvidia chips off a wafer, and 30 AMD chips... the cost of an extra wafer for AMD to make 50 chips is minimal. Like super super tiny.

As for the memory. Seems like they are using Elpida memory, which is a subsection of Micron it seems.

As for price per chip. seems like AMDs chips are around 9bucks a piece, whilst Nvidias 7GB/s chips are 11 bucks a piece. Nvidia uses Elpida, Hynix and Samsung memory, whilst AMD sticks to Elpida only it seems, although other partners may use other suppliers of memory.

So yes, AMD uses more chips then Nvidia does. However Nvidia almost always uses faster chips. and faster chips costs more. There is also the wildcard of single source of memory causing you to have lower prices (special exclusive deals). We do not know that, and i cannot find any evidence for or against this being the case with AMD and Elpida/Micron. If it is, then it would not surprise me if AMD has so "good" prices that they almost match Nvidia in cost of the memory.

After all, why would AMD choose to go with 8GB if it was not worth it? They may do weird business desicions, but contrary to what some of you think, the people in charge arent THAT stupid.

As for the operating loss.

wasnt that loss something like 2-300 million last year???

I mean, if you somehow get 100 million dollars LESS operating loss IN A YEAR. that is impressive. Sure you lose money, but if they keep this up, they will return to profitability within 2016-2017... that alone is REALLY well done.

Not sure about memory but all my AMD cards so far (5670, 6850, R9 280) use SK Hynix memory

[Sakkura]

Meh, nvidia makes more on their 970's and 980's... smaller chips, higher selling price. Not even reflected in the actual sales prices, because board manuf. have to put more components (higher power load, so more VRM's etc) on the AMD cards and still sell them competitively. 

 

Not that much smaller - 398mm² vs. 438mm². Much less than the advantage AMD had when it was 290(X) vs. 780 (Ti) - 438mm² vs. 561mm². When you add in the fact that AMD didn't have to invest much in developing the 390(X) since it was mostly just a rebadge, whereas the 980 and 970 use a brand new GPU, AMD did alright here.

[Morgan MLGman]

Actually AMD cards perform terribly in Fallout4 and Witcher3. Those are literally the worst games out of the lineup of you're comparing AMD vs. Nvidia.

Actually, they don't perform "terribly" in The Witcher 3.

I played the game from the beginning to the end three times, once with my old GTX 660, second time with my GTX 970 and third time with my R9 290X, and I can tell you there's little to no difference, in favor of the 290X, I couldn't run HairWorks on my GTX 970 and I can't run in on my 290X due to framerates dropping too low, I mean I can run it but this overtesselated piece of garbage from NVIDIA is not worth the hassle. HBAO+ that's included is decent and takes like 3-4 frames per second on my 290X so it's cool.

So TL;DR, The Witcher 3 runs good on AMD cards, my flatmate has R9 380, runs very well (better than a GTX 960). And my R9 290X runs it just as well, or a little better than my 970. Can't say much for Fallout 4 but on recent drivers it seems that if you tweak one or two settings it's more than fine on R9 390 cards for example

 

[Sakkura]

As for the memory. Seems like they are using Elpida memory, which is a subsection of Micron it seems.

As for price per chip. seems like AMDs chips are around 9bucks a piece, whilst Nvidias 7GB/s chips are 11 bucks a piece. Nvidia uses Elpida, Hynix and Samsung memory, whilst AMD sticks to Elpida only it seems, although other partners may use other suppliers of memory.

 

 

Not sure about memory but all my AMD cards so far (5670, 6850, R9 280) use SK Hynix memory

 

AMD uses a variety of GDDR5 sources. Nvidia probably does too, at least so long as the higher speeds they rely on don't limit their options.

 

My 290 uses Samsung memory, others are Hynix or Elpida. I would assume 390s also come with memory from a variety of sources (well, among the few available - Micron/Elpida, Samsung, and SK Hynix make up the vast majority of the supply).

 

PS: Micron bought Elpida in 2013.

[SkilledRebuilds]

Invest, wait for Zen.

[Notional]

Meh, nvidia makes more on their 970's and 980's... smaller chips, higher selling price. Not even reflected in the actual sales prices, because board manuf. have to put more components (higher power load, so more VRM's etc) on the AMD cards and still sell them competitively. 

 

That was why smaller nodes was such good business in the olden days: The very expensive silicon wafers could yield more chips and thus lower the price. Today however, new nodes are so expensive to invent and has such problems with yields (initially), that node shrink is no longer a good way to lower prices. Especially wince silicon is getting so cheap, that you can make a huge wafer plaform for Fiji to interconnect the GPU and HBM.

However, Maxwell being a much simpler architecture, and making highly defective chips into 970 (reason for 3.5GB+0.5GB structure) and selling them for a high price, is making NVidia a lot of money.

 

However the point of beefier cooling could be a point. But really is you look at Asus, MSI, etc, they pretty much all have the same VRM's and cooling solutions today.

 

Except Nvidia is selling their 398mm2 cards for 550 euro, and AMD is selling their 438mm2 cards for the same price as a 970. 

 

It's even worse for the GTX 960 vs R9-380. That card is 228mm2 vs. 366mm2. It's truly a slaughtering ground....

 

During nvidia's 3.5GB fiasco. 

 

Roy was his name, not rob. Such salt, such base. Comedic timing? Huh?

 

Silicon matters little. Complexity does however, so a bigger more complex chip, might result in lower yields. I am still baffled, why people are buying 970. A fundamentally defective chip, that will have problems with the VRAM in the future.

 

Can't blame a company for using their competitions derping to their advantage. Their marketing was factually correct and made sense. This is not the place I would criticize AMD.

 

buying AMD would be like playing the lottery with your entire savings account

what happens with our brand new ZEN and Polaris if AMD goes under - U'r fckd! no matter MicroSoft phasing you out, AMD will do it for them 

 

Again with the propaganda FUD. No, buying NVidia is a lottery with their planned obsolescence. The 770/780 series is obsolete and are crashing in performance compared to AMD's competition architecture/cards. AMD has by far the best support in the graphics industry, by a mile. Intel is a joke and NVidia practices planned obsolescence. Why people are even accepting their extremely expensive 780ti's being gimped to hell is beyond me.

 

People keeps talking about AMD going bankrupt. I don't think people understand how a publicly traded stock company works.

 

As an investor this is great news. We can see the trend that the operating loss is getting smaller and smaller. Anyone who invested in a company doesn't care that this Quarter will be a loss or not. It cares about the trend and ROI over a longer period. This shows that the company will slowly bust steadily make a profit eventually in the next few years. And that is perfect. 

 

Finally someone with some economical knowledge. Bear In mind that AMD is still making their CPU's on 28nm, that they only have a midend architecture in the 285 and a new(er) architecture in Fiji/Fury X. The rest are old cards. AMD lost a lot of designs made for 20nm due to TSMC's incompetence (do notice how AMD has scrapped TSMC on their GPU's, going full GloFo/Samsung). There's a reason for that. Scrapping so much work has cost AMD a lot in lost investments, as well as being stuck with obsolete architectures/nodes.

 

With that in mind, seeing AMD improving their economy to the extent they have, is very impressive. Especially with all the investments in Radeon Group.

 

In tech companies in big business like AMD, all changes/investments takes a lot of time to implement. We are talking years here. ZEN was started in 2012! AMD is on the right path, and things should improve drastically with Polaris launching, and ZEN at the end of the year. Neither of them has to beat the competitor in everything, they just have to be competitive.

We know ZEN will be competitive enough for AMD to go all AMD on the server/compute market, and be useful in desktop and laptop markets, to be fully competitive with Intel.

We also know Polaris is amazing. Especially with HDR support (we don't even know if Pascal supports that yet. In fact the extreme lack of 16nmFF+ demonstrations along with no info on anything Pascal feature is worrying).

 

You can turn off all GW effect in those games.

 

I can, but I as a customer pay for this crap to be implemented in the game. Remember that this replaces what would otherwise be high end settings made by the devs themselves. So I can either have a worse looking game than I paid for, or get shit performance because NVidia wants to lock in all their consumers and thus undermine competition (vendor lock in and unfair business strategies).

[Rune]

Not too surprising. With Nvidia owning the high end and Intel tearing up the low end with most iris pro models being roughly equal to a 750ti in gaming performance, AMD really has nowhere left to go.