قالب وردپرس درنا توس
Home / Business / AMD's poor outlook, crypto-chip slowdown, fuels powerlessness in the semiconductor sector

AMD's poor outlook, crypto-chip slowdown, fuels powerlessness in the semiconductor sector



Chip maker Advanced Micro Devices Inc. mingled Wednesday with news that there's a flood of graphics chips that are no longer hot commodities among cryptocurrency miners.

On Wednesday, AMD

AMD, -9.17%

AMD, -9.17%

reported a slight third-quarter revenue and a weak fourth-quarter outlook, leading to a decrease in revenue recent shares of over 25%. in the after-hour trade. The news of oversupply of graphics processors, in addition to a lukewarm forecast, seemed to confirm investors' hoped-for profits from Intel Corporation

INTC, -4.67%

Manufacturing errors may not be as great as expected.

The company said its Epyc server chips continue to progress and continue to pursue a goal of achieving a 5% share of the Intel-dominated market. But the data center profits were not enough after AMD revealed the GPU oversupply that was caused by the same slowdown as Nvidia Corp. seemed to come from.

NVDA, -9.79%

reported in August More of Therese: Why AMD believes it can challenge Intel in servers.

AMD boss Lisa Su told analysts that the graphics chip business is about $ 100 million lower than expected as sales of crypto-mines cooled off.

"We expected the segment to go down, but we probably expected it to be around [$50 million] or so," Su said, when the actual drop was $ 150 million. "And if you look at the difference at the beginning of the quarter, that's the GPU channel."

In the fourth quarter and first quarter of 2018, AMD recorded huge increases in graphics chip revenue on cryptocurrency miners. In the first quarter, AMD said that sales related to crypto-mines accounted for approximately 10% of total sales, a larger share than in previous quarters. But in August, after a steep fall in prices of Bitcoin

BTCUSD, -0.59%

Nvidia said the crypto-boom is over and expects no further contribution to sales.

Do not Miss: This chipmaker has set a warning flag for the entire industry

"The disappointment is the whole crypto-GPU overhang," Christopher Rolland, an analyst with the Susquehanna Financial Group Who Had Headwind predicted in GPUs, said in an e-mail. "Since ether

ETHUSD, -0.99%

Prices have fallen … the channel is full of GPU inventory.

The crypto crash was bigger than expected, but it was not a shock, according to Nvidia's warning, the big surprise was a forecast that did not bring big profits, while the bigger competitor Intel was experiencing supply bottlenecks in its PC chip manufacturing process

Opinion: Carl Icahn is right with Dell's complex, self-enriching attempt to re-enter the public market

Su's most direct comment on the possibility of exploiting Intel's problems "That was some pockets of supply chain constraints around PCs." "We saw this towards the end of the third quarter," Su said. "We're increasing our production so we can meet some of that demand. And I think that's a short-term statement.

Any chipmaker that speaks of stockpile oversupply and weak demand will be hard-hit in this environment where Texas Instruments was already worried about a downturn one day earlier.

TXN, -8.22%

Add this to AMD's renewed relationship with Wall Street and the huge stock gains in the last quarter, and you have a recipe for exactly the huge decline AMD suffered After this report

Would you like to send this type of analysis to your inbox? Subscribe to MarketWatch's free MarketWatch First Takes newsletter. Sign up here.


Source link