The official version can be found here, and in it, AMD says that guidance was from +3 to -3% for Q2, but results will come in at -11%. One bright spot is operating costs are down 8%. We will leave the analysis of the numbers for those who do it for a living, and concentrate more on the question of, “What happened?”
When SemiAccurate was talking to various sources at AMD, OEMs, and AIBs as late as mid-June, there was absolutely no hint that something like this was going on. Things were, if anything, slightly upbeat, Trinity was coming, and all was looking good. Then out of the blue, wham, down 11%.
Q2 tends to start slow and finish stronger, so lets just assume that the percentage of sales is roughly 30% April, 30% May, and 40% June, roughly down 3%, 3% and up 7% respectively. Rounding off the numbers a bit, a 10% decrease in June would mean about a 25% drop in sales for the month, or 50% drop if it was contained to the second half of June. This means that whatever happened could have been in the last two weeks of the quarter, or even the last week itself, unlikely though that seems. Quarter ends tend to have massive sales due to various players wanting to meet goals and make their internal numbers, so both are possible.
If the AMD drop was indeed constrained to the last half of June, that means someone dumped a massive quantity of parts late in the month at blowout prices. AMD is competing with two players here, Intel on CPUs, and Nvidia on GPUs. All three companies have a long track record of end of quarter blow-out pricing and one time specials, so this is not an unknown phenomenon. Of the two, which one could it be?
If AMD sells about $1 billion a quarter, that drop off is around $100 million, and to scoop up those sales, Intel or Nvidia would have to discount by a substantial percentage of that number. Intel could do this on a whim and hide the result in marketing money, they do this all the time to stifle AMD and Nvidia sales.
Nvidia is tricky to call, the numbers don’t really make sense for this large a drop to come soley from GPUs in the time frame that we think this happened in. That said, in early June, Nvidia had a massive inventory glut that they were beside themselves trying to get rid of, AIBs all said that GTX680 allocation was based almost purely on orders of “crap”. Even with that in mind, the numbers don’t point to Nvidia as a player, but if they did, it will undoubtedly show up in their Q2 numbers.
If Intel is the one, the discounts will likely have to be a very large percentage of the $100 million figure due to the disparity in ASPs between AMD and Intel CPUs. That said, it still could be hidden with ease in the massive Intel slush funds and nebulous marketing campaigns. Given the magnitude and size of the likely discounts, all fingers point to Intel being the one. Anyone know specifics?S|A