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AMD managed to resist, but profit is still far away
According to ZDNet columnist Larry Dignan, AMD withstood Intel’s biggest blow. The question is what happens next? On the one hand, we see Intel’s results in the second quarter, which turned out to be good, but bearing the imprint of a “price war”, and on the other, AMD’s report for the same period recorded losses of 600 million.Doll.
Nevertheless, the situation inspires optimism for adherents of healthy competition. AMD has slightly, but increased its market share, acquired a large laptop manufacturer Toshiba as customers – and it is the sales of laptops that are now the determining factor in the growth of the PC market, and was able to continue developing new products. In general, the source states, AMD managed to hold out until the official market debut of Barcelona, which, we recall, is scheduled for the current quarter.
Dirk Meyer, Chief Operating Officer (COO) of AMD, said that for the first time in the company’s history, all five of the largest PC manufacturers offer products on AMD platforms. Other concrete examples of the company’s strong footing include the recently unveiled Dell PowerEdge servers and Dell Inspiron desktops, the Sun Blade 6000 and HP Blade PCs, and LG Electronics’ AMD Imageon 2282 processor-based cell phone.
Among the factors that will determine the future position of the company, the source notes the following: the success of Barcelona, the ability of AMD to reduce the expenditure side of the budget, a significant increase in the volume of shipments in quantitative terms.
Adding these terms, experts come to the conclusion that AMD, as a boxer who received a series of punches, although it manages to stay on its feet, is still far from victory. Christopher Danely, Analyst J.P. Morgan believes that the company will not be able to show profit during 2021, as it will be more important for it to maintain market share. He is echoed by UBS analyst John Lau, who cites the following figures: in the second quarter, AMD chip shipments increased by 38% compared to the first quarter, and gross revenue increased by 12%. As Lo figuratively puts it, AMD is practically giving away microprocessors. In such a situation, profit will not appear soon.
Source: Seeking Alpha