If developing a game for a console and you know that the CPU has eight weak cores, you can design your game around that and it's fine. On a desktop, there are too many programs that require high single-threaded performance. AMD isn't competitive with Intel there and hasn't been in years.
The problem with AMD's APUs right now is that the CPU is simply too weak. If AMD's CPUs were about as good as Intel's, having the better integrated graphics is a lot more tempting.
And if AMD puts some HBM into the APU so that they can beef up the GPU and still have plenty of bandwidth for it, that would really be a killer product. If AMD does that with a CPU competitive with Intel and a GPU competitive with Nvidia, there would be no point in getting anything else in a gaming laptop, and little point in getting anything else in a sub-$1000 gaming desktop. That might not be most of the PC market, but it's a much larger chunk than AMD's current market share.
AMD has been getting crushed by Intel and Nvidia for years. I don't see that trend changing any time soon.
AMD gained over 7% dGPU marketshare in last quarter alone and is now at 35% dGPU marketshare.
Yea they are finally in a place where they can come out on top. Problem is they were in debt and just now borrowed money to pay it off. Hopefully it works out for them.
First part of debt is due in 2019. So you got something very very wrong.
You read something wrong. The 2019 is the second debt not the first. They are borrowing 1bil to pay off debt that is due right now. They are also increasing their market share which drives down price and it did that already. Stock dropped 10% in a few days because of this alone. Doesn't mean its a bad move it just shows they aren't clear out of the water quite yet.
You have no clue about structure of their debt.
They have 2b $ debt that they have to repay 2019-2025 of which 586m is in 2019.
AMD would rule the world if they fixed the disaster that is usually thier drivers these days. paaaaaathetic. I was ATI/AMD graphics for over a decade, jumped ship a little less than a year ago.
I swtiched over to AMD because of pathetic NVidia drivers, most DX12 games were unplayable and Vulkan driver is terrible since it introduces awful stuttering. They are pretty much worst experience i had since 2009-2010 - on NVidia too.
This is actually looking really good for AMD's business. They have been doing better than previously, and now they are able to reorganize their financing with better terms. More secure funding allows them to focus on business instead of worrying whether they are able to pay next month's expenses.
AMD going under would be very bad. Nvidia needs a competitor.
Yeah, Intel as well. Personally do I think it is bad that 3DFX isn't around anymore as well. Competition keeps prices lower and forces progress at a faster pace.
AMD has been getting crushed by Intel and Nvidia for years. I don't see that trend changing any time soon.
AMD gained over 7% dGPU marketshare in last quarter alone and is now at 35% dGPU marketshare.
Yea they are finally in a place where they can come out on top. Problem is they were in debt and just now borrowed money to pay it off. Hopefully it works out for them.
First part of debt is due in 2019. So you got something very very wrong.
You read something wrong. The 2019 is the second debt not the first. They are borrowing 1bil to pay off debt that is due right now. They are also increasing their market share which drives down price and it did that already. Stock dropped 10% in a few days because of this alone. Doesn't mean its a bad move it just shows they aren't clear out of the water quite yet.
You have no clue about structure of their debt.
They have 2b $ debt that they have to repay 2019-2025 of which 586m is in 2019.
Stop spreading missinformation.
Maybe you should read the article before trolling this thread. Here let me help you
"Advanced Micro Devices will use the net proceeds of $1.02 billion received from offerings to repay borrowings under its credit facility and/or to purchase its outstanding senior notes."
AMD has been getting crushed by Intel and Nvidia for years. I don't see that trend changing any time soon.
AMD gained over 7% dGPU marketshare in last quarter alone and is now at 35% dGPU marketshare.
Yea they are finally in a place where they can come out on top. Problem is they were in debt and just now borrowed money to pay it off. Hopefully it works out for them.
First part of debt is due in 2019. So you got something very very wrong.
You read something wrong. The 2019 is the second debt not the first. They are borrowing 1bil to pay off debt that is due right now. They are also increasing their market share which drives down price and it did that already. Stock dropped 10% in a few days because of this alone. Doesn't mean its a bad move it just shows they aren't clear out of the water quite yet.
You have no clue about structure of their debt.
They have 2b $ debt that they have to repay 2019-2025 of which 586m is in 2019.
Stop spreading missinformation.
Maybe you should read the article before trolling this thread. Here let me help you
"Advanced Micro Devices will use the net proceeds of $1.02 billion received from offerings to repay borrowings under its credit facility and/or to purchase its outstanding senior notes."
The article does not say when those borrowings and outstanding notes must be paid.
Based on AMD's own info from Q2 they have a bit over $2 billion dept that must be paid between 2019 - 2014, and a bit over $200 million dept as a secured line of credit.
AMD has been getting crushed by Intel and Nvidia for years. I don't see that trend changing any time soon.
AMD gained over 7% dGPU marketshare in last quarter alone and is now at 35% dGPU marketshare.
Yea they are finally in a place where they can come out on top. Problem is they were in debt and just now borrowed money to pay it off. Hopefully it works out for them.
First part of debt is due in 2019. So you got something very very wrong.
You read something wrong. The 2019 is the second debt not the first. They are borrowing 1bil to pay off debt that is due right now. They are also increasing their market share which drives down price and it did that already. Stock dropped 10% in a few days because of this alone. Doesn't mean its a bad move it just shows they aren't clear out of the water quite yet.
You have no clue about structure of their debt.
They have 2b $ debt that they have to repay 2019-2025 of which 586m is in 2019.
Stop spreading missinformation.
Maybe you should read the article before trolling this thread. Here let me help you
"Advanced Micro Devices will use the net proceeds of $1.02 billion received from offerings to repay borrowings under its credit facility and/or to purchase its outstanding senior notes."
And you should read actual financial reports of the company before you start spreading misinformation around.
Its easier to call someone a troll than to actually educate yourself on the matter from actual source instead random "article on the internetz". And in fact this thread is trolling by you.
AMD has been getting crushed by Intel and Nvidia for years. I don't see that trend changing any time soon.
AMD gained over 7% dGPU marketshare in last quarter alone and is now at 35% dGPU marketshare.
Yea they are finally in a place where they can come out on top. Problem is they were in debt and just now borrowed money to pay it off. Hopefully it works out for them.
First part of debt is due in 2019. So you got something very very wrong.
You read something wrong. The 2019 is the second debt not the first. They are borrowing 1bil to pay off debt that is due right now. They are also increasing their market share which drives down price and it did that already. Stock dropped 10% in a few days because of this alone. Doesn't mean its a bad move it just shows they aren't clear out of the water quite yet.
You have no clue about structure of their debt.
They have 2b $ debt that they have to repay 2019-2025 of which 586m is in 2019.
Stop spreading missinformation.
Maybe you should read the article before trolling this thread. Here let me help you
"Advanced Micro Devices will use the net proceeds of $1.02 billion received from offerings to repay borrowings under its credit facility and/or to purchase its outstanding senior notes."
And you should read actual financial reports of the company before you start spreading misinformation around.
Its easier to call someone a troll than to actually educate yourself on the matter from actual source instead random "article on the internetz". And in fact this thread is trolling by you.
It doesn't change the fact that they used the money to pay off debts. Regardless of how and when they were due they used it for that purpose. Aprox 500 mil of that 1 bil has to be repaid. Meanwhile a nice chunk of that 600 mil was taken from shareholders. I'm sure you can understand how that works maybe not. Its like refinancing your house in a sense. IDK maybe 10 articles that all say they are using the money to repay debts and some of them are called outstanding. So call it what you want you aren't understanding this not me.
Here look another article saying the same thing. Maybe its easier to understand how they are wording it.
"Funds will be used to pay down the company's $226 million balance on its existing revolving credit facility and $450 million in outstanding 7.75% senior notes. "
So you can see that 450 million was past due aka outstanding senior notes. They sold more senior notes to pay off the ones they have sold already. So maybe you are doing the potato potato thing here but its still a debt and its outstanding and needs to be paid so they borrowed and took a cut from current shareholders to help it move along.
It doesn't change the fact that they used the money to pay off debts. Regardless of how and when they were due they used it for that purpose. Aprox 500 mil of that 1 bil has to be repaid. Meanwhile a nice chunk of that 600 mil was taken from shareholders. I'm sure you can understand how that works maybe not. Its like refinancing your house in a sense. IDK maybe 10 articles that all say they are using the money to repay debts and some of them are called outstanding. So call it what you want you aren't understanding this not me.
From AMD financial report: £2B debt (2019-2025) plus a revolving credit facility of just over $200M revolving (presumably $226M).
They are borrowing $450M (due date 2026) and having a $600M rights issue (new shares) and plan to pay off $450M and the revolving credit facility.
So new debt $2B (2019-2025) + $450M (due 2026) - $450M (planned repayment) i.e. $2B due (20xx to 2026). And $0 revolving. With whatever is left of the $600M new money invested.
Doesn't merit - imo - the "AMD's business not looking so good" headline.
Here look another article saying the same thing. Maybe its easier to understand how they are wording it.
"Funds will be used to pay down the company's $226 million balance on its existing revolving credit facility and $450 million in outstanding 7.75% senior notes. "
So you can see that 450 million was past due aka outstanding senior notes. They sold more senior notes to pay off the ones they have sold already. So maybe you are doing the potato potato thing here but its still a debt and its outstanding and needs to be paid so they borrowed and took a cut from current shareholders to help it move along.
Outstanding debt just means you haven't paid it yet. It doesn't mean it's past due or you're defaulting on it.
It doesn't change the fact that they used the money to pay off debts. Regardless of how and when they were due they used it for that purpose. Aprox 500 mil of that 1 bil has to be repaid. Meanwhile a nice chunk of that 600 mil was taken from shareholders. I'm sure you can understand how that works maybe not. Its like refinancing your house in a sense. IDK maybe 10 articles that all say they are using the money to repay debts and some of them are called outstanding. So call it what you want you aren't understanding this not me.
From AMD financial report: £2B debt (2019-2025) plus a revolving credit facility of just over $200M revolving (presumably $226M).
They are borrowing $450M (due date 2026) and having a $600M rights issue (new shares) and plan to pay off $450M and the revolving credit facility.
So new debt $2B (2019-2025) + $450M (due 2026) - $450M (planned repayment) i.e. $2B due (20xx to 2026). And $0 revolving. With whatever is left of the $600M new money invested.
Doesn't merit - imo - the "AND's business not looking so good" headline.
It could easily go either way. It can be seen as bad because selling more stock does not make a business worth more money. It can be seen as good because they have an extra 300 million to use for expansion. But that must turn over profits or it ends up biting them in the ass really hard. They couldn't pay off the outstanding senior notes so they had to figure out another way to do it. So selling more senior notes to pay off the first set is a good idea because it worked. But selling the extra stock hurt investors because some of it was their money too. Approximately 18% of that 550 million was money taken straight from current shares.
I'm sure the stock will go up again here soon but it won't be untill next quarter statements are given. And that won't help unless they are showing some good positive numbers.
Hurts investors? Really? AMD has gone from <2$ to >7$ in few months. The only ones "hurt" are those playing lottery with shorting the stock.
So stop trolling and linking trash sites like "seekingalpha".
Its obvious you love AMD I guess because you have some shares. That does not automatically mean this decision was a good move for them. It did cost investors 18% of their share price. And that will continue to fall unless they make some kind of announcement or they have good numbers on their quarter. You are saying they didn't need to do this move but somehow they did it and yes it cost quite a bit. So either it was a good move and only time will tell us that. They either had to be completely confident that the move would result in more money. Or they are taking a shot hoping it works out.
If you want to discuss why AMD shares have increased the way they have it has nothing to do with what just happened. They are making more money and they have introduced products that have a strong indication that it will capture major market values. And if you want to get technical the share price has went from 2.62 in April to 7.62 a few weeks ago. But it is now at 6.22 because of this recent move.
I see everyone's thoughts on the topic. But I would like to ask for what reason AMD did this if not to pay off debt? And why sell notes to pay off notes when they have 3 years to pay those off anyways? If they needed 300 million they could have just sold that much stock, instead they pulled this entire move.
Sorry for randomness but its like refinancing your home. There is only a few reasons to do such an act. You are saying that AMD did not have any of those reasons?
1. The oustanding notes were due and they didn't have money to pay them. 2. The rate on the new notes is somehow much better and makes it worth the move.
Otherwise why payoff the outstanding notes right now?
Hurts investors? Really? AMD has gone from <2$ to >7$ in few months. The only ones "hurt" are those playing lottery with shorting the stock.
So stop trolling and linking trash sites like "seekingalpha".
Its obvious you love AMD I guess because you have some shares. That does not automatically mean this decision was a good move for them. It did cost investors 18% of their share price. And that will continue to fall unless they make some kind of announcement or they have good numbers on their quarter. You are saying they didn't need to do this move but somehow they did it and yes it cost quite a bit. So either it was a good move and only time will tell us that. They either had to be completely confident that the move would result in more money. Or they are taking a shot hoping it works out.
If you want to discuss why AMD shares have increased the way they have it has nothing to do with what just happened. They are making more money and they have introduced products that have a strong indication that it will capture major market values. And if you want to get technical the share price has went from 2.62 in April to 7.62 a few weeks ago. But it is now at 6.22 because of this recent move.
You are trolling again.
And those buying stock are not investors, AMD doesnt see ANY of that money. And now they will because they will sell more stocks. Any "investor" is welcome to buy AMD stock, now at reduced price at that.
"Why" shares increased is irrelevant, if you bought AMD stock at 1.83 just few months ago you STILL made 3,4 times of what you invested. So spare me "OMG investors lost 18%". "investors" lose money on various stocks every single day.
Reducing debt/cost of your debt is actually PREFFERABLE than doing nothing.
And why sell notes to pay off notes when they have 3 years to pay those off anyways?
They are now in financially better position, and will be able to get dept with lower interest rate. The interest rate decrease should save them millions every month.
Well your opinion is not popular by any means. Here's yet another article.
"AMD's investors aren't happy about that idea, since both offerings could dilute the value of the 795.56 million currently outstanding shares by as much as 18%. However, the dilutive effect on valuations shouldn't be severe, since AMD stock is still fairly cheap at 1.4 times sales."
"Last quarter, AMD posted its first quarter of annual sales growth in two full years. Sales rose 9% on the strength of its EESC (enterprise, embedded, and semi-custom) business, and AMD expects sales to rise 18% for the current quarter."
They are banking on the fact that this quarter's sales is enough to make up for it. Like I said it will probably take 2 quarters just to bounce back. And investors/websites are agreeing with my side of this discussion. Do you have any links supporting your ideas?
But I know if you put out great products, the rest usually takes care of itself somehow. And if you put out crap, then that tends to take care of itself too.
With the launch of their new GFX cards and some of their CPU,APU chips they are still having problems that will take a few years to recover. Basically they are indebt and have opened up to selling an extra 1 billion worth of the company to help pay it off. This does not necessarily mean its bad but it also doesn't imply anything good at all. Basically they are borrowing money to pay off debts. Its a cycle that every company wants to break at some point.
To the degree that there is any news about AMD's financial condition here, it's in the premium they had to pay in higher interest rates to compensate for the possibility that they won't be able to repay the loans. For example, if you think there's a 20% chance that a loan won't be repaid, this can be compensated for by demanding 25% more money as repayment, which can be pro-rated into a higher interest rate. If you think there's a 50% chance you won't be repaid, you demand double the repayment of what it would be if you were guaranteed to be repaid. As the chance of repayment gets too small, you end up having to demand such usurious interest rates that even if everything goes well for the company, they still can't repay the loan, and the company ends up unable to borrow money.
However, even if you were 100% certain that a loan would be repaid, you'd still want interest on your money. A dollar today is worth more than a dollar 10 years from now. So the risk premium depends not just on the interest rate AMD is paying, but how that compares to what the interest rate would be for something guaranteed to be repaid. And that can depend on a whole lot of factors, so I have no idea what it is.
Comments
The problem with AMD's APUs right now is that the CPU is simply too weak. If AMD's CPUs were about as good as Intel's, having the better integrated graphics is a lot more tempting.
And if AMD puts some HBM into the APU so that they can beef up the GPU and still have plenty of bandwidth for it, that would really be a killer product. If AMD does that with a CPU competitive with Intel and a GPU competitive with Nvidia, there would be no point in getting anything else in a gaming laptop, and little point in getting anything else in a sub-$1000 gaming desktop. That might not be most of the PC market, but it's a much larger chunk than AMD's current market share.
They have 2b $ debt that they have to repay 2019-2025 of which 586m is in 2019.
Stop spreading missinformation.
If someone else buys AMD. Intel loses x64 license and AMD loses x86 license.
"Advanced Micro Devices will use the net proceeds of $1.02 billion received from offerings to repay borrowings under its credit facility and/or to purchase its outstanding senior notes."
Based on AMD's own info from Q2 they have a bit over $2 billion dept that must be paid between 2019 - 2014, and a bit over $200 million dept as a secured line of credit.
Source:
http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MzQ1MDQxfENoaWxkSUQ9LTF8VHlwZT0z&t=1&cb=636047257998009683
Its easier to call someone a troll than to actually educate yourself on the matter from actual source instead random "article on the internetz". And in fact this thread is trolling by you.
"Funds will be used to pay down the company's $226 million balance on its existing revolving credit facility and $450 million in outstanding 7.75% senior notes. "
http://seekingalpha.com/article/4004919-new-issue-analysis-advanced-micro-devices-convertible-senior-notes-due-2026
So you can see that 450 million was past due aka outstanding senior notes. They sold more senior notes to pay off the ones they have sold already. So maybe you are doing the potato potato thing here but its still a debt and its outstanding and needs to be paid so they borrowed and took a cut from current shareholders to help it move along.
They are borrowing $450M (due date 2026) and having a $600M rights issue (new shares) and plan to pay off $450M and the revolving credit facility.
So new debt $2B (2019-2025) + $450M (due 2026) - $450M (planned repayment)
i.e. $2B due (20xx to 2026). And $0 revolving. With whatever is left of the $600M new money invested.
Doesn't merit - imo - the "AMD's business not looking so good" headline.
I'm sure the stock will go up again here soon but it won't be untill next quarter statements are given. And that won't help unless they are showing some good positive numbers.
So stop trolling and linking trash sites like "seekingalpha".
If you want to discuss why AMD shares have increased the way they have it has nothing to do with what just happened. They are making more money and they have introduced products that have a strong indication that it will capture major market values. And if you want to get technical the share price has went from 2.62 in April to 7.62 a few weeks ago. But it is now at 6.22 because of this recent move.
Sorry for randomness but its like refinancing your home. There is only a few reasons to do such an act. You are saying that AMD did not have any of those reasons?
1. The oustanding notes were due and they didn't have money to pay them.
2. The rate on the new notes is somehow much better and makes it worth the move.
Otherwise why payoff the outstanding notes right now?
And those buying stock are not investors, AMD doesnt see ANY of that money. And now they will because they will sell more stocks. Any "investor" is welcome to buy AMD stock, now at reduced price at that.
"Why" shares increased is irrelevant, if you bought AMD stock at 1.83 just few months ago you STILL made 3,4 times of what you invested. So spare me "OMG investors lost 18%". "investors" lose money on various stocks every single day.
Reducing debt/cost of your debt is actually PREFFERABLE than doing nothing.
"AMD's investors aren't happy about that idea, since both offerings could dilute the value of the 795.56 million currently outstanding shares by as much as 18%. However, the dilutive effect on valuations shouldn't be severe, since AMD stock is still fairly cheap at 1.4 times sales."
"Last quarter, AMD posted its first quarter of annual sales growth in two full years. Sales rose 9% on the strength of its EESC (enterprise, embedded, and semi-custom) business, and AMD expects sales to rise 18% for the current quarter."
They are banking on the fact that this quarter's sales is enough to make up for it. Like I said it will probably take 2 quarters just to bounce back. And investors/websites are agreeing with my side of this discussion. Do you have any links supporting your ideas?
http://www.investopedia.com/stock-analysis/090816/amd-sinks-stock-and-convertible-debt-offering-amd.aspx
But I know if you put out great products, the rest usually takes care of itself somehow. And if you put out crap, then that tends to take care of itself too.
However, even if you were 100% certain that a loan would be repaid, you'd still want interest on your money. A dollar today is worth more than a dollar 10 years from now. So the risk premium depends not just on the interest rate AMD is paying, but how that compares to what the interest rate would be for something guaranteed to be repaid. And that can depend on a whole lot of factors, so I have no idea what it is.