I won't resurrect this tread, but I can't help noticing that NV is now a 25% bigger company than the combined AMD+ATI.
ATI Q4 earnings... when?
- Thread starter Geeforcer
- Start date
At the time of the buyout ATi's financials were not in good shape, their net profit margins were actually in the negetives, which the buyout really helped conceal what position ATi was at with future growth. And I think this is what Orton side stepped in his explination of the buy out when he stated they didn't see much future growth in the current market trends.
ATi really got a great deal for the buyout, IMO I think if AMD held out for another quarter they could have gotten ATi for alot less, but of course its a competitve market, there could have been other vultures lurking around.
ATi really got a great deal for the buyout, IMO I think if AMD held out for another quarter they could have gotten ATi for alot less, but of course its a competitve market, there could have been other vultures lurking around.
Don't confuse future growth with relatively short term swings. Future growth is looking 4+ years out.
And if they don't, they won't. That's why it's hard for me to call that overpaying, as its a requirement to make the deal work. In this case, if I recall, most or all of the "premium" above ATI's stock value was AMD stock anyway, rather than cash, and some chunk of the cash was actually from ATI's current balance sheet at the time.
If buying ATI was what they wanted to do, I don't think they significantly overpaid. Better to make the case they shouldn't have wanted to in the first place. . . but its a different case.
If ATI's market cap right now was ~3 billion, and I don't see why that's such a stretch considering that has been almost all bad news since mid-summer, I don't see why a buyout right now would not have saved AMD a bundle of money. Clearly, if there was behind-the-scenes bidding war going on with a third party that would not be the case - otherwise one would have to conclude that AMD bought a company on a short-term downward swing without accounting for it. And yes, I am suggesting that they could have gotten it for less had they just sat and waited for a few things (like ATI's notoriously unreliable delivery timelines) to play out.
Agreed, but hindsight is 20:20. AMD didn't know ATI would fail to execute over the ensuing 6 months. Also some of that lack of execution is likely a result of the buyout, due to losing key people as well as general de-motivation of the remaining ATIers.
Indeed. AMD lost 11% of their stock value the other day, in large part because they didn't have any products to compete against Intel's Core 2 Duo offerings. I think if the stock drops some more this week (which it probably will), it'll be a good buy opportunity when looking at their products in the 2nd half of 2007 and into 2008.
I do wish ATI were a separate company though. Their stock would've been hammered by now, and it would've made a great buy opportunity since they had a clearer roadmap of truly competitive products than AMD. Right now, we just don't know if AMD's future processors can be competitive with Intel, particularly since they're just barely getting to 65nm and Intel will be releasing 45nm processors in the fall.
In terms of the best long term bet, I'd go double down with Intel right now. Their pricing/performance aggressiveness, along with their detailed roadmap and stock price bargain compared with long term pricing, makes it a great buy.
I do wish ATI were a separate company though. Their stock would've been hammered by now, and it would've made a great buy opportunity since they had a clearer roadmap of truly competitive products than AMD. Right now, we just don't know if AMD's future processors can be competitive with Intel, particularly since they're just barely getting to 65nm and Intel will be releasing 45nm processors in the fall.
In terms of the best long term bet, I'd go double down with Intel right now. Their pricing/performance aggressiveness, along with their detailed roadmap and stock price bargain compared with long term pricing, makes it a great buy.
http://amd.edgarpro.com/redirect_fr...rtBy=receivedate&AD=D&startrec=1&res=25&pdf=0
It's so bad it's not even funny
Let us hope, for the industry's sake, that R600/RV610/RV630 improve things in H1 2007. Analysts are going to lose patience, and fast...
This is not for a full quarter though, so the revenue is less disastrous - but the net loss of the GPU + Chipsets division is just worrying!
Uttar
It's so bad it's not even funny
Let us hope, for the industry's sake, that R600/RV610/RV630 improve things in H1 2007. Analysts are going to lose patience, and fast...This is not for a full quarter though, so the revenue is less disastrous - but the net loss of the GPU + Chipsets division is just worrying!
Uttar
Anarchist4000
Veteran
They released them after the market closed so you probably won't see very much until tomorrow. It appears to list ATI as having an operating loss of $13 million in the 4th quarter. Revenue was about $398 million. And that's the entire company. I can't find any breakdown for anything ATI related.
AMD said:
that the "former ATI" revenue was for only 68 days of the quarter. They got not quite 3/4 of a quarter revenue in there.
Jawed
Legend
Eh? How does one quarter's $416M of ATI R&D get charged as "acquisition and integration costs"? The commitment to undertake that work might have been there before the acquisition took place (or some of it might have arisen solely because of the acquisition) but that seems like a funny way to treat it.
That's actually more than AMD spent on R&D, which is pretty funny.
They can't treat it like that in future quarters, can they?
Jawed
That's actually more than AMD spent on R&D, which is pretty funny.
They can't treat it like that in future quarters, can they?
Jawed
Without reading the footnotes, which don't exist now, it's just a one-time non economic charge to help reconcile the difference between the purchase price for ATI, and ATI's book value, which was far lower. This difference arises in the vast majority of acquisitions. It's all accounting and has no bearing on economics.
I wouldn't think so. I'm not there yet tho (listening to the call replay now). Did they describe it as a "quarter" worth? I'm wondering if they charged off some RD that ATI had previously decided to spread out. Like maybe spread out over the life of the expected royalties of XB and Wii? That's a WAG tho. Haven't heard it yet.
Whee, that was some thin gruel for the average graphics geek. Well, other than what I just put on the front page. Orton wasn't even there.
I think we've likely lost about 50% (or more) of the usefullness of these calls for gaining visibility into former-ATI operations and go-forward plans. It's just buried in the bigger beast.
Other than what's on the front page, the only other "Hmm!" moment I had was that they had $50M of royalty and patent license revenue in the period. Did AMD have any of that prior to ATI acquistion? Or is that all XB360 and Wii?
Orton wasn't even there.I think we've likely lost about 50% (or more) of the usefullness of these calls for gaining visibility into former-ATI operations and go-forward plans. It's just buried in the bigger beast.
Other than what's on the front page, the only other "Hmm!" moment I had was that they had $50M of royalty and patent license revenue in the period. Did AMD have any of that prior to ATI acquistion? Or is that all XB360 and Wii?
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