Replies to post #3990 on AMD strictly moderated (AMD)

[CombJelly]

"I can't believe the beating AMD is taking in the 1st hour of trading. "

If the past is any guide, it will start to recover after noon.

[chipguy]

That's the way it is with AMD. No good earnings report ever goes unpunished. No bad earning report ever goes unpunished. Wall Street just likes punishing AMD.

ROFL. Poor little AMD. Perhaps the street is starting to
realize AMD's time in the sun is almost over and the amount
of hay that AMD was able to make is miniscule compared
to the beating it could take on its coming product mismatch
vs Intel. Being a pure MPU play now means what goes up
faster can come down faster... and *harder*.

[wbmw]

Re: I can't believe the beating AMD is taking in the 1st hour of trading. Down $3? The earnings and guidance summary looked pretty good to me. What the heck was the street looking for to meet their expectations?

I actually think there is good reason why they are down. They claimed a 14 week quarter in Q2, but they are still guiding flat to down. If they had a good answer for this, the street might have been easy on them. But the problem was that AMD exerted confidence and cautiousness regarding the competition, both at the same time, and that would give investors the notion that they are lying to them.

Let me put it another way. AMD made a lot of hey over their revenue share gains, and their competitive position for the rest of the year. But when asked the question, "Q: Are you worried about Intel?" they followed with, "A: Well, er, umm, we expected them to follow our lead, and er, umm, that's exactly what they've done." Not exactly a confident response, even though spun with the utmost care. Furthermore, they stated *explicitly* that their lower Q2 guidance was that they wanted to be "cautious" about something in the quarter that they couldn't quite describe. They mentioned weakness in Europe, blah blah blah, but when directly asked about Intel, they once again circumlocuted their position.

I think the analysts read between the lines and concluded that AMD is worried about Intel's pricing pressure next quarter, and definitely worried about Intel's product lines the following quarter. And that's why the stock is down.