AMD reveals $293M joint venture alongside Q1 2016 financials

AMD has released its financial results for the first quarter of 2016. The company posted an operating loss of $68 million on $832 million in revenue, and it posted a net loss of $109 million. Revenue was down 19% from the year-ago quarter, but the company narrowed its operating and net losses compared to a year ago. Here's a tabular summary of the results:

  Q1 2016 Q4 2015 Q1 2015 Change from Q1 2015
Revenue $832 million $958 million $1.03 billion down 19%
Operating income -$68 million -$49 million -$137 million
Net income -$109 million -$102 million -$180 million

AMD reports that it's forming a joint venture with Tianjin Haiguang Advanced Technology Investment Company, Limited (THATIC) to develop system-on-chip products for the Chinese server market. The underlying IP licensing agreement for "high-performance processor and SoC technology" is worth $293 million. AMD says this move helps it to "better monetize its valuable assets." Revenue payments from the agreement will be tied to certain performance milestones. AMD says it'll also receive royalty payments from the joint venture's product sales when they begin.

The Computing and Graphics division took in $460 million in revenue, down 14% from a year ago. The company says decreased sales of its client notebook processors are mostly to blame for the drop. Operating loss for the division shrunk to $70 million, down from $75 million a year ago.

AMD says client processor average selling prices (ASPs) fell compared to a year ago thanks to lower notebook processor ASPs. GPU ASPs increased year-over-year, though, thanks to ASP increases in its channel partner and professional graphics businesses.

The Enterprise, Embedded, and Semi-Custom division took in $372 million, down 25% year-over-year. The company blames shrinking sales of semi-custom SoCs for those results. Operating income for the division contracted to $16 million, compared to $45 million a year ago. The company says the lower profits were caused by lower sales and increased R&D expenses from new product investments. The division also took in $7 million in IP licensing revenue.

Operating losses from all other parts of AMD's business fell to $14 million, compared to $107 million a year ago. The company says a lack of restructuring and other special charges caused the change.

For the second quarter of 2016, AMD projects a revenue increase of 15%, plus or minus 3%, sequentially.

Comments closed
    • tipoo
    • 4 years ago

    1.5 billion over three years earmarked for future console releases, numbering three. NX, XB1.5 (ok, Phil said he didn’t like XB1.5, but it could just mean the name), PS4.5 no doubt, which now makes every console on an AMD APU.

    Only question is, x86 or ARM for NX? I’m rooting ARM, A72 actually bests the x86 Jaguar cores in the XBO/PS4.

      • ronch
      • 4 years ago

      This is why AMD is a very strong candidate in supplying chips for future consoles. They have big x86 and big ARM cores in the pipe. They can also easily put a small ARM core SoC together. And of course, their graphics are tried and tested. I’ve been bad-mouthing AMD a lot these days because I’m honestly disappointed in the decisions they’ve made in the past 10 years but their future looks quite bright if they make it for the next year or so and they don’t shoot themselves in the foot for a while.

        • tipoo
        • 4 years ago

        I think their management was foolish not to ramp up ARM development 10 years ago. Intel is able to shove x86 forward through Intel-like R&D sustained by Intel-like margins, and the moment the market starts to reject those margins, 11% layoffs.

        x86 is quite front end decode limited, or at least needs massive investments to compensate for it. ARM has proven far easier to scale up, one could argue that it’s because they’re in the easy gains section of life, but so far it has not slowed down.

        With AMDs CPU design chops I think they could have done much better on ARM than they do on x86 against Intel.

        AMD is at least starting on ARM now, and will make big ARM, small ARM, big x86, small x86 cores, SoC or no SoC, to suit a lot of needs. My question is if Intel will start new any time in the next decade or two, or cling to x86 while it strangles them.

    • Geonerd
    • 4 years ago

    Revenue was down ~20% from Q1’15, but payments to GloFo are unchanged.

    Does anyone know the gruesome details of that godawful “Wafer Supply Agreement” that has been bleeding AMD for so many years?

    • southrncomfortjm
    • 4 years ago

    Man, Scott did some Damage to those financials.

    • Freon
    • 4 years ago

    Wow, stock is up ~39% for the day. People really want to believe. I guess that IP money could edge them into the black for a few quarters if everything else holds. But I’m kind of doubting that.

    I want to believe to as a consumer that Polaris will come out and at least be solid competition to Pascal, but I’m not buying any $AMD.

      • chuckula
      • 4 years ago

      Sold my 400 shares today.
      Waiting for $2/share again.
      It’s the circle of life.

        • AJSB
        • 4 years ago

        Buy low, sell high, been there, done that, carry on :”) :p

          • ronch
          • 4 years ago

          AMD’s motto however, is “Buy high, sell low.”

            • AJSB
            • 4 years ago

            WHY you think i NEVER bought AMD shares ? :”)

            Having said so, if i had bought shares in the begin of year, i would have done a boat loaded of
            money now.
            It will soon drop a bit…but we better watch closer to Polaris, Bristol Ridge and Raven Ridge launches…it could be very profitable.

            • NoOne ButMe
            • 4 years ago

            Why the downvotes on this? AMD has a pretty bad history of bad acquisitions and getting much less than they paid for.

        • anubis44
        • 4 years ago

        Still holding all 16,000 AMD shares I bought at $2.00, and holding on for $10/share, which AMD last hit in January of 2010. I might trade in and out of them if anything stupid happens, but until Zen benchmarks hit, which they will very shortly, the danger is in being sold out of AMD, not owning AMD shares. We’re not going to see $2.00/share for AMD again, I’m afraid.

          • Meadows
          • 4 years ago

          That’s a bit too ambitious. If I were you, I’d worry about the stopping power of the $5.50-$6.10 range on the way up and possibly hedge my bets there a bit.

      • anubis44
      • 4 years ago

      Pascal will also be missing asynchronous compute engines, so they’ve already lost the next round. That, plus the AMD console sweep, and the next gen consoles already looking like they’re all AMD, it looks like nVidia is making a slow, gracious exit from the gaming graphics card business to focus on self-driving cars and HPC, the latter of which they’re also about to get major competition in from AMD.

        • K-L-Waster
        • 4 years ago

        [quote<]Pascal will also be missing asynchronous compute engines, so they've already lost the next round.[/quote<] Source? [quote<]That, plus the AMD console sweep, and the next gen consoles already looking like they're all AMD...[/quote<] The console business isn't exactly bringing in boatloads of money for AMD, according to their financials. Hard to see the next gen changing that much -- it's not a high margin business. [quote<]...it looks like nVidia is making a slow, gracious exit from the gaming graphics card business to focus on self-driving cars and HPC, the latter of which they're also about to get major competition in from AMD.[/quote<] Uhh, in RL your name wouldn't be "Charlie" would it?

          • NoOne ButMe
          • 4 years ago

          [url<]https://images.nvidia.com/content/pdf/tesla/whitepaper/pascal-architecture-whitepaper.pdf[/url<] Or are you suggesting that Nvidia put features into smaller Pascal GPUs and not into the larger one? I would advise watching AdoreTV's video, it sums up why the consoles matter [url<]https://www.youtube.com/watch?v=aSYBO1BrB1I[/url<] Although some of his comparisons fall flat... Like the junk Quantum Break port he used as an example. Both Nvidia and AMD have been trying to find ways out of the gaming GPU market for a while. Or rather to survive once gaming GPU market contracts. AMD has iGPUs so they have less reason to run. Nvidia's attempts so far have been very lackluster. Not sure why anubis44 thinks that AMD is going to have viable HPC competition with Nvidia anytime soon. They don't look to have compatible hardware with Polaris or Vega.

    • AJSB
    • 4 years ago

    I just re-read this news and…how can this be possible AT ALL ?
    I believed that AMD x86 licence could not be transfered in any form or shape…granted, it’s a joint venture and that is what is shielding AMD from Intel’s Wrath…but even so…if this kind of thing flies, i can see the chance for NVIDIA makes a “merge” with AMD….and “get” indirectly, besides other things, a x86 license.

      • muxr
      • 4 years ago

      AMD and ATI are also technically a joint venture. This is no different. If you read the cross license agreement, subsidiaries are shielded as well.

        • ronch
        • 4 years ago

        AMD and ATI is not a JV. AMD [u<]BOUGHT[/u<] ATI for a shipload of money.

          • muxr
          • 4 years ago

          Read the cross license agreement. Parent company and subsidiaries have the same status in it. So JV subsidiary or a company merger (through acquisition) is legally the same thing as it pertains to the x-license agreement.

            • ronch
            • 4 years ago

            Whatever.

      • derFunkenstein
      • 4 years ago

      Could just be the ARM versions of their coming server SoCs, too.

        • AJSB
        • 4 years ago

        doesn’t seem so, i read in other place that it’s x86 arch…in fact, seems that Lisa was asked if it was OK (taking in account the terms of AMD x86 licence) and it seems that she said that it’s all good.

    • NoOne ButMe
    • 4 years ago

    And this is what happens when you want to seriously license. You find companies to work with and work with them.

    I believe in the conference call Lisa Sue said Polaris is 3Q. Did not catch if this means to OEMs/SI/AIBs or to consumers. Hopefully for AMD and market competition it is consumers.

    • ronch
    • 4 years ago

    Oh man. AMD really is almost dead now if this is the kind of news we get about them. It’s just sad but I guess AMD surviving this long after such a long string of losing quarters is already a miracle, and we really can’t expect anything more. It’s like the dying patient on life support. Still alive, but barely. And unless a miracle happens, he’s really going to die and it’s just a matter of time.

    Edit – thanks for the downthumbs, fanbois!

      • MOSFET
      • 4 years ago

      I like AMD too, but it sounds like you’re talking about a family member.

        • ronch
        • 4 years ago

        No, don’t make it personal, pal. AMD has been losing money and bleeding talent and falling further and further behind for years. Is that not a sign of a company that’s slowly dying? If it weren’t for Zen and Polaris we’d count AMD out already. But AMD is so silent with Zen that we don’t know just how well it’s shaping up. True or false?

          • Tirk
          • 4 years ago

          The only reason I down thumbed you is after the edit that you assume only a fanboy would disagree with what you said.

          You have been negative about AMD news for quite a while and promoting the idea of it being on its deathbed over and over, any part of you that did like AMD is in the past. You sound like the greedy child waiting to pull the plug on their parents.

          Do you go on the same way about other companies that do not make money? Twitter hasn’t made any profit for years and yet keeps chugging along for a DECADE now. Its definitely best for a company to make money but most can have a very long string of losses to get back up to profitability.

          I am familiar with a string of down votes and up votes on this site and I never immediately trash talk them as due to fanbois chinking at my virtuous armor. Sometimes they might be a fanboy but sometimes it might be because they disagree with what you said right or wrong.

            • ronch
            • 4 years ago

            They down thumb because (1) they are fanbois who get hurt every time someone says something negative about the companies they’re fanbois of that isn’t in line with their version of reality, and (2) because not fanbois but they prefer to stay positive even if they need to deny what’s really happening.

            Reread my original post and tell me which part is not true. Should I have put something nice and comfortable there to make the die hard fanbois happy? Would you take the reassuring lie or the inconvenient truth?

            As for being an AMD fan, I do plan to get Zen and Polaris. What I truly hate is how AMD is run by a bunch of monkeys that keep shooting themselves in the foot. If that’s cool with you then….

            • Tirk
            • 4 years ago

            You can definitely dislike what AMD is doing but your original post talks about a dying patient. AMD performed exactly as expected this quarter and you find that this quarter is the one that spells doom for it?

            I explained why what you said in your original post was unrealistic why don’t you read my post again?

            • ronch
            • 4 years ago

            Um, what? I think this quarter will be the one that spells doom for them? If you think a company that keeps losing bajillions every quarter isn’t synonymous to a dying patient, I don’t know what Kool-Aid you’re drinking. And I don’t know how much money AMD still has. There can’t be a lot left so I don’t know how much longer they can keep this up. I have to admit being amazed they haven’t sunk yet, though. Many other companies would’ve folded early on. But my stance remains: this is no way for a company to keep doing if they want to keep doing business. True or false?

            As for performing exactly as expected this quarter, you’re right. It was expected.

            • Tirk
            • 4 years ago

            False, I gave you a perfect example of a TECH company lasting a decade and is still going while it lost over $2 billion dollars. And yet, you strangely fail to acknowledge that. I’m afraid your Kool-Aid is a lot stronger than whatever I’m drinking.

            But I don’t need to do your homework for you, its not as if there are not plenty of companies you can EASILY look up that have lost money for YEARS and still recovered to make profit. You make a bad analogy and suddenly its everyone else’s fault? Look in the mirror dude.

            But let’s all just make bad analogies and blame everyone else when they have no substance:
            Intel makes bajillions of dollars and therefore is JUST LIKE GOD it can never die unless miraculously resurrected to once again be GOD. Why no one worships Intel is beyond me and anyone who thinks otherwise is a fanboy!

            • ronch
            • 4 years ago

            Look, I’m talking about AMD. I DONT care about whatever company you wanna bring up just to win this argument and counter whatever I’m saying. I’ve been an AMD fan since the early 90’s and I DONT like the way they’re doing now which is synonymous to a dying person, and I SAY it. I DONT CARE if a thousand other companies are also like this because they DONT affect me nor do I care nor am I following them. OK? I’m talking about a SPECIFIC company I’ve been following for decades and here you are, making unwelcome replies, bringing in all the examples in the world that are NOT relevant to what I’m talking about just to win an argument. AMD makes stupid move after stupid move, stupid publicity after stupid publicity, for a company that the industry depends on as a counterbalance to Intel in the biggest market segment in the world of computing. Don’t compare AMD with Twitter or whatever.

            Go.

            • NoOne ButMe
            • 4 years ago

            AMD has been sevely mismanaged but in the last few years they have cut that rate a lot. Most of their recent delays have been due to things like wanting to have all the drivers ready (I understand they had to write tons of drivers for their A57 POS part), doing what OEMs wanted (Carrizo) and an architecture being pushed to far (Fiji). Their last major mismanagement I can think of was either the Kaveri delay or overproduction of Hawaii cards during mining.

            AMD has about 650 million of cash/equiv on hand currently I think. Probably closer to 1B after their packaging sales goes through. Polaris looks like it will bring them back to a respective market share (40%+) and if Zen is good enough than AMD looks to be able to pay off their debt and stay alive. And if that doesn’t happen AMD will split, and half will fall. And not on a GPU/CPU line.

            And I’ve up other everything but your OP. AMD doesn’t need a miracle, just to execute well. I suppose you could say AMD executing well is a miracle…

            • Tirk
            • 4 years ago

            Don’t make it personal, pal…..

            Or does that only pertain when you say it? Why even comment here if anytime someone makes a valid counter you blow up and call them invalid? If I’m not supposed to compare them to another company that has years of losses than who else am I supposed to compare them to in your narrow world? Oh right, the only comparison you find valid is one comparing AMD to a dying patient, right………

      • Mr Bill
      • 4 years ago

      The old joke was that even though AMD lost money on every unit, they would make it up on volume. Which actually, is sort of true.

      • nanoflower
      • 4 years ago

      The last thing I recall being said was that at AMD’s current run rate they had enough in the bank to get them through 2019. That’s assuming Polaris and Zen don’t bring them much in profits. The X86 venture with China will provide them a bit more revenue once it gets going and the new consoles that seem likely to be announced this year should also help out AMD’s bottom line.

      So while AMD isn’t doing great the doors aren’t going to be shuttered just yet. If Polaris and Zen can sell well then AMD could be around for a lot longer as that would give them the revenue to keep operating and investing into R&D.

      • maxxcool
      • 4 years ago

      Like Via 😉 Or tansmeta, or Centaur…? /pours more gasoline/

    • End User
    • 4 years ago

    To put revenue into perspective, shortly before they were purchased by AMD, ATI had revenues of $652.3 million USD in the third quarter of fiscal 2006.

    I previously worked for ATI (up in Markham, Ontario, Canada). Sad to see AMDs GPU business lose so much ground.

    • chuckula
    • 4 years ago

    So I listened to the webcast of the conference call SO YOU DON’T HAVE TO (and believe me, I’m doing you a favor).

    Polaris: Launching “middle of 2016” not a big surprise there. Slightly more interesting: Last question at about 50:00: Polaris is clearly described as being “mainstream desktop” (“big” Polaris) down to lower-end desktop and mobile (“little” Polaris). Nvidia has stopped production of the GTX-980Ti… AMD? Still apparently churning out Fury chips…

    Polaris Revenue (32:30): Polaris is a “second half story”.

    Zen (21:30): Vague talk about Zen, something about “on track to sample to select customers” in the second quarter, but that was in the context of server parts. Remember that in Server World sampling usually occurs a solid year (or more) before you can buy a part.

    Lots of crap about the joint venture. In response to a question, Lisa Su directly said that the IP in the joint venture is solely owned by AMD and that there are no issues with AMD giving away Intel’s technology…. we’ll see how this plays out.

    Joint Venture (29:30): More vague stuff about the licensing agreement that AMD is licensing “technologies” but not “products”. Question: Will the JV be able to manufacture x86 server chips in China? Answer: YES. –> Good luck with that AMD.

    JV (38:30): Are you making money from actual Chinese server sales in 2016/2017? Lisa Su: Not really, it’s a “long term” venture.

    Bristol Ridge (31:15): Lisa Su talks about how it launched in March… can’t buy one anywhere can you? Just remember AMD’s rather interesting definition of “launched” when you can’t buy Zen in December even as AMD brags about how it has “launched”.

    [url<]http://edge.media-server.com/m/p/me7hjshq/lan/en[/url<]

      • the
      • 4 years ago

      Manufacturing x86 chips in China shouldn’t be too big of a deal. [url=https://techreport.com/news/26518/intel-and-rockchip-partner-on-x86-soc-for-budget-tablets<]Intel is already doing that with TSMC through a deal with Rockchip.[/url<] The more interesting aspect would be if AMD is designing a custom server part specifically for the Chinese market. That would turn the heads of a few spooks.

        • ronch
        • 4 years ago

        AMD is not Intel. Intel owns x86. AMD is a licensee.

          • muxr
          • 4 years ago

          Actually it is exactly the same. Intel can’t make x86_64 CPUs without AMD’s license the same way AMD can’t make x86 chips without Intel’s license.

          The cross licensing agreement is on equal terms.

            • ronch
            • 4 years ago

            Yes I know. But Intel still holds the longer end of the stick and AMD still needs to play by Intel’s rules. They’re still not equals in this uncomfortable symbiotic relationship. Far from it.

            • muxr
            • 4 years ago

            That may have been the case before they settled, and signed the agreement. But it hasn’t been the case for a long time.

            • ronch
            • 4 years ago

            If it’s a marriage of equals then AMD can just let go of their x86 license or transfer it if they get acquired. But it’s such a tricky thing that I bet it’s the primary reason no one wants to buy them out and start cranking x86 chips. No, Intel STILL owns x86. They’re held at gunpoint by AMD64 but they still own x86 and apart from some instructions and registers, it’s still defined by them. IIRC the AMD64 spec includes the earlier SSE instructions, which is from Intel. Obviously later SSE subsets came after AMD64 was defined and so are no longer part of the AMD64 spec.

            • muxr
            • 4 years ago

            x86 is useless without x86_64 the same way x86_64 is useless without x86. Samsung was looking at buying AMD, but it’s a big complex beast. And with PC market shrinking it would be a giant risk. Especially considering AMD’s debt.

            But AMD has tons of its own IP, and provided they can execute well from now on, they stand to gain a lot.

            As it pertains to the China deal, there is nothing Intel can do.

            Would love to see Intel try though. They’d be going against Chinese government not just AMD.

            edit: since I seem to be getting a lot of downvotes because of this statement, let me elaborate. JV is with Chinese government (education department) . If you don’t think China wouldn’t block Intel from China if Intel went after this venture, just check how well Google does in China.

            • ronch
            • 4 years ago

            Dude, that’s like saying a lessee now also owns part of the house because they helped the lessor with some legal stuff so the lessor wouldn’t lose the house.

            Do you know how much of x86 is owned by Intel and how much is owned by AMD?

            • Tirk
            • 4 years ago

            While I agree AMD is still constrained by what they can do because of Intel your analogy is a bad one. AMD has been able to increase what they can and cannot do over time so its not as simple as we may think.

            Critique of your example:
            Depending on the severity of the “legal stuff” and local laws pertaining to the help, the lessee could in fact have some claim and use of the property, hence there usually being a contract or lease signed. The fact that the lessor in your example could have lost the ownership of the house without the help of the lessee already gives sway to a more complex relationship.

            Bear in mind also, no one in the U.S., and almost all other countries for that matter, have a fully Allodial title. That Lessor is bound to the Government’s greater ownership of all the lands it governs and hence forth why we are forced to pay property taxes, endure imminent domain, and follow local land use laws.

            • ronch
            • 4 years ago

            Are you an AMD fanboi?

            • Tirk
            • 4 years ago

            Because you hate having your example fall apart you ask if I’m a fanboy?

            • ronch
            • 4 years ago

            Look, I have no time talking with irritating people like you. Don’t reply to my comments here. They are NOT welcome. Go irk someone else in your real life, OK?

            • Tirk
            • 4 years ago

            Wow so if I just randomly say to someone, like say Ronch, to go away they are not welcome they’ll just poof and disappear with all of their comments?

            I’ve been doing this wrong, Ronch you are irritating go away your comments are not welcome. Now lets see if your theory works……..

            • muxr
            • 4 years ago

            x86 and AMD64 is cross licensed on an equal footing. Read the license agreement. There is no quantity in the license agreement being mentioned.

      • AJSB
      • 4 years ago

      What AMD launched in March was BRISTOL RIDGE, a Carrizo evolution, NOT ZEN….and is only shipping to notebooks and alike OEMs….no AM4 (AM4 socket is the re-branding of former planned FM3 socket that was simply re-branded for marketing reasons) shipments yet…and yes, that is pissing me off.

    • ronch
    • 4 years ago

    AMD is cheating. I saw them type ‘god’ on the drop down console many years ago.

      • f0d
      • 4 years ago

      IDDQD
      needs DNCASHMAN

        • ronch
        • 4 years ago

        Too bad ‘giveall’ doesn’t work anymore, otherwise they could just enter it and have a killer CPU and GPU design.

    • chuckula
    • 4 years ago

    Did anybody listen to the actual conference call or read the transcript for news about Zen? None of their posted documents mention it although Polaris gets some coverage.

      • muxr
      • 4 years ago

      I have. Zen is meeting expectations. Zen server parts are on track to ship samples to select partners this quarter.

    • Tristan
    • 4 years ago

    “For the second quarter of 2016, AMD projects a revenue increase of 15%” – for what reason ? Intel and NV will stop sales ?

      • MathMan
      • 4 years ago

      If things are like last year, the next quarter is when silicon is produced for consoles that will be sold for Xmas.

      Polaris launch may also play a role?

      It’s a bit annoying that they predict a 15% increase sequentially but that they don’t say what that means YoY. If somebody would do the effort of looking this up…

        • Leader952
        • 4 years ago

        [quote<]they don't say what that means YoY. If somebody would do the effort of looking this up...[/quote<] $832 *1.15 = $956.8 million projected revenue next quarter. Last year the 2nd quarter ending in June had $942 million in revenue So they are actually projecting a gain YoY of 1.6% [url<]http://finance.yahoo.com/q/ae?s=AMD+Analyst+Estimates[/url<]

          • MathMan
          • 4 years ago

          You’re the hero we need.

          1.6% YoY is better than going down, I guess, so yay!

            • ronch
            • 4 years ago

            And to think your name is Mathman.

            • NeelyCam
            • 4 years ago

            LOL

        • DancinJack
        • 4 years ago

        MathMan can’t do the math?

          • MathMan
          • 4 years ago

          Last year’s Q2 results were not there, but Leader952 came to the rescue.

            • DancinJack
            • 4 years ago

            I was just trying to be clever.

          • derFunkenstein
          • 4 years ago

          In that case I should change my name to JavaScriptMan.

      • NoOne ButMe
      • 4 years ago

      Polaris shipments to OEMs and AIBs will start, console sales/build for late 2Q and 3Q will be higher. Also I believe that 15% includes licensing dollars. Probably accounting for a good chunk of that 15+/-3

      • Wirko
      • 4 years ago

      The effect of Tech Report co-founder’s work at AMD is expected to have some real effect on revenue by then.

      • Meadows
      • 4 years ago

      The reason being that average people stop being broke by the time of the second quarter or so.

      • kuttan
      • 4 years ago

      Intel and NV wont stop sales . But AMD starts sales is the difference.

      • anubis44
      • 4 years ago

      No, because AMD`s GPU and CPU products will rival those of their competitors. Or is that too self-evident for you to grasp?

    • flip-mode
    • 4 years ago

    AMD could make a fortune teaching other companies how to avoid death. It’s nothing short of a miracle that this company is still around.

    I’d like to see what the next generation of Radeons with HBM-2 will bring… if the miracle lasts.

      • derFunkenstein
      • 4 years ago

      While I get what you’re saying, it would eventually make them like those self-help authors: “I turned into a millionaire by telling people how to turn into a millionaire!” which is kind of funny.

      • bfar
      • 4 years ago

      If Polaris and Zen don’t deliver, it’s hard to see it carrying on for long..

      • rudimentary_lathe
      • 4 years ago

      They are still very competitive in graphics, which is why they continue to get major design wins for consoles and elsewhere.

      They’re also right that they have a lot of valuable IP to monetize.

      Even if Zen fails outright – which I think is unlikely – there will still be value in the Radeon Tech Group.

      • Nike
      • 4 years ago

      Hmm…wasn’t it rumored that Intel was to a degree keeping AMD on life-support to avoid monopoly accusations or somesuch? Probably fud, but might play some part in their continued survival. *adjusts tinfoil hat*

    • chuckula
    • 4 years ago

    [quote<]The Enterprise, Embedded, and Semi-Custom division took in $372 million, down 25% year-over-year. The company blames shrinking sales of semi-custom SoCs for those results. [/quote<] What good is a 100% console monopoly when you can't turn it into a growing segment?

      • odizzido
      • 4 years ago

      I don’t think it really matters if it’s growing or not, as long as it’s profitable.

        • chuckula
        • 4 years ago

        [quote<]Operating income for the division contracted to $16 million, compared to $45 million a year ago. [/quote<] I guess that's profitable, kinda, but considering that $372 million is 44.7% of AMD's revenues, you'd like to see a little more than $16 million in operating profits on that large of a chunk of your revenue stream.

          • odizzido
          • 4 years ago

          yeah, I’d love for AMD to be raking in cash for the console chips but still, +16 million is at least something for them.

          I really hope zen is good…and their new GPUs.

            • ronch
            • 4 years ago

            Even if Zen matches Intel in every single benchmark AMD will probably ask a little bit less for them. They need to because they really are seen as ‘the other guys’. Bad for them, good for us.

            • anubis44
            • 4 years ago

            Funny. I see Intel and nVidia as the “other guys”, and AMD as the default purchase.

          • ronch
          • 4 years ago

          Well, you know AMD. They always pay too much and sell for too low. They bought NexGen and ATI for too much, asked too little for the IP they sold off to Qualcomm, they ask too little for their products, etc. Somehow they just couldn’t shake off the image of being the cheaper alternative and they’re too desperate to buy stuff that they’re willing to pay a lung and a kidney for them.

          I think they really need better negotiators.

            • NoOne ButMe
            • 4 years ago

            Apart from the few years Intel brides OEMs almost all AMD’s issues have been from severe mismanagement IMHO. I think Llano was delayed s year because the teams internally were fighting over for area. Phenom was later than it should have been because someone at AMD insisted on a “true quad core” I think. GCN didn’t get any big updates until now because RR froze R&D spending if I understand right.

            (Lack of decent) Marketing also has played a role when it comes to competing with Nvidia.

            • Fursdon
            • 4 years ago

            According to (I know this is verboten, so take with a grain of salt) Charlie, the frozen R&D spending was by the CFO and interm CEO Thomas Seifert. Read might have also had a hand in this, but I don’t remember any sources pointing to that.

      • maxxcool
      • 4 years ago

      Nvidia let go of consoles for a reason. The margins just are not there after Initial release.. Let alone have a bottom bidding war with your rival.

        • Deanjo
        • 4 years ago

        Exactly what I was saying when everyone else kept proclaiming that “AMD beat nVidia in the console wars”. Can’t really beat someone that didn’t even play.

          • chuckula
          • 4 years ago

          [url<]https://en.wikipedia.org/wiki/Pyrrhic_victory[/url<]

            • maxxcool
            • 4 years ago

            ^ This. Arguing over price and then going with a 10$ call-girl instead is not a win. Does it provide revenue to AMD? Sure, it’s a plus column line item. But the time and resources spent to get said small, tiny revenue stream is somewhat toxic.

            • Northtag
            • 4 years ago

            Not necessarily: AMD infamously fell afoul of their GloFo wafer volume agreement, so a project that doesn’t even net you any profit at all in itself can still in such circumstances save you from otherwise losing money.

          • nanoflower
          • 4 years ago

          Yes. That’s why it’s funny when people mention Intel in regards to the consoles. Intel isn’t interested in low margin products like consoles (or at least they haven’t been in the past.) AMD probably could have pulled more money out of Sony and Microsoft if they had been willing to push, but in their situation at the time they were probably more concerned with the supposed halo effect of being in the consoles.

        • the
        • 4 years ago

        nVidia let go of consoles? More like console makers let go of nVidia. Back in 2002 there was a lawsuit between MS and nVidia over GPU/chipset pricing for the original Xbox. Sony only approached nVidia about doing the GPU for the PS3 due to Sony’s own attempts at turning Cell into a GPU failed (think a project similar to Larrabee). The relationship between nVidia and Sony wasn’t the most ideal pairing according to rumors but Sony basically had to and settled for a Geforce 7000 series class chips. Due to delays with the PS3, nVidia actually shipped the 8800 GTX a few weeks prior to the PS3 launch.

        The only player nVidia hasn’t worked with has been Nintendo and well Nintendo is a special hardware case. Nintendo likely passed on any nVidia offering as they weren’t pursing bleeding edge tech for a console. The CPU design in the Wii U has roots in the PowerPC 750 which was introduced nearly 20 years ago.

          • NoOne ButMe
          • 4 years ago

          Nintendo staying away from Nvidia probably has more to do with their fetish for back-wards compatibility and going with the company ATI bought that did the GameCube GPU.

          Although Nvidia didn’t have as low power for the price Nintendo would pay until after the Wii U. And given Nintendo probably wants easy ports they have been herded towards AMD this round due to GCN and x86.

          • maxxcool
          • 4 years ago

          No, sorry that’s inccorect. Nvidia sued Microsoft specifically over the pricing of the chipset\igpu after sales of the x-box were not even half of what was expected. Microsoft would not budge on the price cuts they wanted to make for the next iteration and Nv let it go because the margins were not worth the ”revenue”… The court ordered Nv to sell the chipset\igpu at a loss and Nv gave the whole deal the middle finger.

          [url<]http://www.geek.com/games/nvidia-ordered-to-continue-losing-money-making-xbox-chips-550667/[/url<] [url<]http://www.sfgate.com/business/article/Nvidia-loses-Xbox-Microsoft-turns-to-2574657.php[/url<]

        • ronch
        • 4 years ago

        Well, beggars can’t be choosers. AMD needs every penny they can given how they’re burning through tons of cash.

        • muxr
        • 4 years ago

        nVidia couldn’t compete if they wanted. They can’t make x86 APUs.

        Also despite its thin margins this is turning out to be a very strategic move by AMD. It’s generating revenue however small, which they desperately need to survive until Zen. And it gives them a favorable position when it comes to running console ports on the GCN GPUs. Because the games on consoles are already optimized for them before they are even ported.

        It’s also what started the whole Mantle initiative and it’s what’s favoring AMD GPUs with DX 12. Win win for AMD whichever way you look at it.

        VR is another component where AMD stands to gain more revenue. Being already on the consoles, they would be the logical choice to provide VR technology as well.

          • maxxcool
          • 4 years ago

          I am going to disagree slightly on the console-VR portion. Aside from upscaling there is no chance of native 4k resolution unless there building the ultimate Wii emulator with armless boffins and 20 color pallets. VR while a good boon for dekstops is not going to translate at all in consoles.

          As to compete. NV doesn’t need to. There are MUCH better margins existing elsewhere. And after Microsoft screwed them they simply do not care about cut-rate consoles and bidding wars.

          The interesting thing you bring up is the code port. I swear AMD does not talk between divisions and fights there own staff to their own detriment. Jaguar cores are not modular, so execute like BIG cores and do not share FPU\decoders and pipelines. so coding for them actually HURTS the existing PD\EX desktop\tablet\laptop parts that DO share these resources.. and further cost time and cash to recompile for better module based execution. AMD makes the weirdest choices …

          edit: there to there are

            • muxr
            • 4 years ago

            VR requires a lot of GPU horsepower true. But I am talking about future, not present. Console vendors are also known for subsidising hardware to increase adoption because they make most of their revenue from content licensing. VR could very well be a loss leader. I can very well see two 14nm dual GPU dies pushing decently high res for VR. Perhaps not 4k but high enough.

            We’re also talking about consoles here. So overhead over existing PC VR solutions would be minimal as well.

            To your other point regarding CPUs. That’s mostly just a compiler flag. And we’re bound to see a move to Zen once Zen is available. Jaguar is just all they had for low power SoCs back when they started on the current gen consoles.

      • NoOne ButMe
      • 4 years ago

      The segment includes or hints besides console (enterprise and embedded) which probably have 40-50% of the non-COG spending.

      Also the consoles tend to sel higher in 4Q, which means stronger 3Q/early 4Q sales. And lowering in 1Q as the big buying season is over. If it keeps this low through 2Q and 3Q than it spells big trouble.

      • DoomGuy64
      • 4 years ago

      It’s future proofing. Consoles = free GPU optimization. AMD is finally starting to pull ahead of nvidia now that the console investment is paying off. The only real problem is mindshare. Nvidia has some diehard fanboys who’ll pay more for less. It’s going to take a while to break that, but when it does, the flood gates will open. It’s just a waiting game at this point.

      • muxr
      • 4 years ago

      It is growing, just not q2q sequentially. It grows every few years. $1.5B additional revenues expected from 3 new custom-semi chips in the next few years.

    • chuckula
    • 4 years ago

    Is the $51 million from the joint venture included in revenue & net income data?

    If yes then the results without the joint venture are somewhat scarier than they already are.

      • AJSB
      • 4 years ago

      I don’t think that those JV numbers are included….it states that when silicon start shipping, AMD will receive 1st money…or may be i read it badly.

        • Deanjo
        • 4 years ago

        You usually don’t include revenue based on receipt of monies in accrual accounting, you base it on invoiced amounts.

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