AMD now worth less than it paid for ATI

[Pete]

<Mod Hat>I've trimmed an unnecessary comment and echo. There's catharsis and then there's trolling. The comment crossed the line, and the echo doesn't help.</Mod Hat>

 

[BRiT]

They need to fix the Phenom and take performance lead. I also think they should sell stake in ATI. They dont need a GPU company.

Do what you're good at.

I'd say they're better in the GPU realm than the CPU realm. At least now they seem to be fairing better with the price/performance of GPUs than CPUs. Don't you think they'd have released a bugfree top of the performance crown Phenom if they could have by now? Should they go back to doing nothing but GPUs?

 

[Skrying]

As of right now the ATi part of the company is the only one showing any promise at all. HD 3850 and HD 3870 are really good products in their price range, and if Nvidia doesn't have anything in the 3850 price range then it could lead to a lot of sales, we'll see. AMD's problem is that Phenom is a disaster, no getting around that.

 

[SugarCoat]

As of right now the ATi part of the company is the only one showing any promise at all. HD 3850 and HD 3870 are really good products in their price range, and if Nvidia doesn't have anything in the 3850 price range then it could lead to a lot of sales, we'll see. AMD's problem is that Phenom is a disaster, no getting around that.

AMDs other problem is their management, you think ATi is the better half? They disagree, they infact blame it as the main cause:

“The acquisition took place at the moment, when ATI was not really leading in terms of technology… It is not like we acquired ATI and we lost market share. It was just a consequence of [ATI’s execution]: Nvidia had better graphics than ATI back then and that is why AMD lost market share. We also should consider [hardware] cycles of OEMs: if you are missing their cycles, you are out for a while. You have to be [ready] with the right [product] part at the right moment to get a cycle. When you are in, you are going to stay in for a long time. So, the main reason behind the share loss is missing OEM cycles. But we are regaining them now,” recently said Vincenzo Pistillo, director of consumer business development in EMEA region for AMD.

“This conclusion was reached based on the results of an updated long-term financial outlook for the businesses of the former ATI Technologies as part of AMD’s strategic planning cycle conducted annually during the company’s fourth quarter and based on the preliminary findings of the company’s annual goodwill impairment testing that commenced in the beginning of October 2007,” a statement concerning the write-down reads.


......While it is evident that business of former ATI has been harmed considerably in the most recent seventeen months, AMD insists that the explanation of dramatic revenue decline is ATI’s issues with execution that were left unnoticed by AMD during the acquisition process going on for nearly a year: starting from December ’05 and closing in October ‘06. It is interesting to note that without former ATI earnings of AMD in the most recent quarter could be as low as $1.2 billion (thanks to later-than-expected quad-core chip launch in September), instead of $1.632 billion......

Xbit did a pretty decent summation/breakdown

http://www.xbitlabs.com/news/cpu/di...Graphics_Multimedia_Business_Performance.html

Personally i blame both. Core 2 duo crushed AMD, and they're of course still working on a reply to it 2 years after the fact, and both sections of AMD, graphics and central processors, keep blowing product release schedules which they cant afford to do in either case.

I dont understand. AMD is FINALLY back in peoples' homes. Dell and Gateway, Acer, plenty of companies are bundling AMD chips again, like they haven't in a LOOOONG time.

Not going to help a whole lot if you cant release your products in a timely fashion which makes OEMs reduce the size of their orders (especially with the other guy being dependable as ever) and im sure demand is in the toilet as well when the price/performance ratio is so obviously skewed in favor of Intel when it comes to computers based around their processors. The problem is everything. From what has been coming out of their R&D right down to the release and marketing of the actual product.

 

[Skrying]

AMD can't blame ATI, they can blame the acquisition of ATI (which is AMD's fault) but I'm going to say they were fairly certain what they were getting into with ATI. If you look at each sides most recent products though by far ATI's show the most promise. At least ATI has a real chance to sell a number of cards in the mid range market, which is where the money is at.

 

[Fox5]

I hope it's not up to Shanghai. I put some hope on 10.5k next year. AMD must have some flexibility to broaden its investiments on research.

As for the Nintendo comparison, I don´t think its fair. Consoles are basicaly toys. You still have a chance to beat the competition by using artistic creativity, like the Wii console. Now, IC companies relies to heavily on performance. Artistic sense not always bring the best results, if it ever once brought.

AMD could always go for cutting costs as much as possible. Maybe there's a market for a deluge of ultra cheap cpus with the performance of say a 2Ghz athlon?

I am really surprised how fast Intel has surpassed AMD. There was a several year period where Intel stagnated while AMD increased performance at the normal rate, and the Athlon 64 seems like a design that's about as good as x86 can get, people say Mhz and the single core are dead, and then bam, intel comes out with the core 2 duo series and they're not really letting up. It amazes me just how easily intel has surpassed AMD, but at the same time I suppose it's representative of just what a colossal failure the P4 must have been in Intel's eyes.
Not to mention that AMD's fab tech has always been behind intel's, and you'd have think that would slow as things get tougher (for everyone) to move to smaller nodes, but intel still seems to be moving along at about the same pace while everyone else is slowing down.

It's funny though, had AMD not bought ati, the market capitalization of ATI + AMD would probably be higher than it is today. People seem to ignore what ATI brings to the table, beyond the added costs to AMD.
Thank goodness for AMD though that nvidia isn't the collosal giant that intel is. Besides better dev relations and a current lead in GPU and chipset tech, nvidia competes under the same conditions that ati does, and if anything ati might have the fab advantage now if they can leverage amd.

 

[Arun]

AMD could always go for cutting costs as much as possible. Maybe there's a market for a deluge of ultra cheap cpus with the performance of say a 2Ghz athlon?

How is AMD not already part of that market? The Sempron-LE family, which is based on the 65nm single-core Sparta, is pretty much what you describe there; it sells from $37 to $53.

However, I agree that even longer-term there's probably a market for this kind of performance due to the commoditization of the CPU industry. However, it's not like Intel doesn't have anything coming up there (Diamondville/Silverthorne microarch) and it's pretty much VIA Land right now (C7 with half that level of performance, but CN is expected to be roughly on par).

In fact, as I already said before, I'm incredibly bullish on the prospects of CN so I'm sure competition would be pretty intense there - and honestly, even with all my optimism, I don't think that market is sufficiently big to usable as a 'strategy' for a company the size of AMD.

Not to mention that AMD's fab tech has always been behind intel's, and you'd have think that would slow as things get tougher (for everyone) to move to smaller nodes, but intel still seems to be moving along at about the same pace while everyone else is slowing down.

That's not completely true; TSMC is the clear exception here. Their 45nm node (with 40nm-like design rules, there won't be a process called 40nm for the general purpose/high performance markets) is likely going to see PC products released on it before 2009.

Assuming their density is as good as they claim it to be, they'll arguably be ahead of Intel litography-wise for at least 12 months! Of course, that's not considering other important factors that define the quality of a process, but those are much less public. And it's worth pointing out TSMC's 32nm SRAM density isn't as extremely impressive as their 45nm one.

Thank goodness for AMD though that nvidia isn't the collosal giant that intel is. Besides better dev relations and a current lead in GPU and chipset tech, nvidia competes under the same conditions that ati does, and if anything ati might have the fab advantage now if they can leverage amd.

Yeah, agreed - at least in terms of not having a massive advantage over AMD, I'm not convinced CPU fabs matter whatsoever in this kind of discussion.

However, I'd still be curious to see what the GPU R&D budgets for both NVIDIA and AMD are. Neither give that kind of granularity; I saw an analyst claiming $500M vs $200M/year recently, but I can't remember where and I doubt it's very reliable...

 

[Arun]

Closing this thread to reconsolidate the topic - there's a reason for the existence of the AMD Despair & Gloom thread, and that's to keep the discussion focused and keep overly negative comments about AMD out of the other threads.