The world is up in arms against AMD. Computers are not for sale, revenue is falling catastrophically

AMD is facing a steep drop in revenue due to the poor performance of its consumer department. Computers based on its processors are not selling well, but it’s not about them, but about global inflation and economic tension. Perhaps Intel has the same problems now, but it has not voiced them yet.

AMD is losing ground

AMD has warned the world about the disastrous results of the third quarter of 2022. According to its analysts, revenue will fall by almost 30% yoy, and the disastrous results of the custom solutions division are to blame.

AMD is one of the two largest manufacturers of x86 processors for laptops, computers and servers. The second is Intel. Since 2017, when the first chips Ryzen based on the first generation Zen architecture, AMD is increasing its share of the global processor market, taking advantage not only of the success of its own solutions, but of the failures of its main rival. In the II quarter of 2022, the share of AMD was 36.4% against, for comparison, 23.1% three years earlier (data Statista.com).

The third quarter of 2022, which ended on September 30, is likely to break out of the already familiar pattern of growth financial AMD success. Its revenue could collapse by 29% to $5.9 billion.

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This is contrary to previously announced forecasts of the company. For the third quarter of 2022, she expected revenue of $ 6.7 billion. The final results are still classified – AMD will publish them on November 1, 2022.

What happened

AMD’s user division was able to disrupt AMD’s plans, sales of which sank by 40% compared to Q3 2021. Moreover, this is the only department of the company that showed “negative growth” during the reporting period.

For comparison, AMD’s revenue from sales of server solutions, as well as chips for data centersis expected to grow by 45% year on year.

The gaming segment, in which AMD is represented by video cards, also showed positive results – revenue growth for the year was 14%. Even in the embedded business, AMD is doing relatively well with a 4% year-on-year revenue growth.

But with all this, AMD has written off in the range of $160 million. This was the result of product price adjustments and extensive inventories of unsold chips.

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Safety

It looks like AMD will have to bear the brunt of global inflation, as well as the general instability in society caused by the events that took place in the world after February 24, 2022. While some countries are engaged in open confrontation, others are suffering from a sharp increase in prices for fuel and energy carriers. In some countries disappear from sale computers and spare parts for them, imported legally, in others, equipment is constantly becoming more expensive.

All this contributes to the fact that consumers around the world have decided not to rush to buy a fresh laptop for the time being and not to assemble a new one. system unit. AMD was the company that was hit hard by this, as confirmed by the company’s CEO Lisa Su (Lisa Su).

The harsh facts of reality

The logic in what is happening with AMD in this case is obvious. Prices for PCs are rising, interest in them from users is falling. The first to suffer are retailers whose sales are declining. They are forced to order less equipment from distributors, and those from direct manufacturers. In the final – a drop in orders from AMD as one of the two suppliers h86processors for modern laptop and desktops.

It is noteworthy that the company Intelnot so long ago unsuccessfully tried take out From Russia several hundred IT people, such forecasts have not yet been voiced. Meanwhile, its Q3 2022 report is currently unpublished as well. It is possible that she, too, faced a drop in the performance of the consumer department.

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Analytical agencies do not yet predict what the results of the global computer market may be in the third quarter of 2022. But their research for the second quarter shows a strong drop in sales.

For example, in a report IDC it is said that the global PC market has collapsed by 15.3%, although in 2021 it demonstrated equally significant growth. Analysts from Gartner recorded a 12.6% drop over the same period. Both companies attribute the decline in sales to a combination of economic uncertainty and rising inflation, as well as the fact that buyers snapped up everything necessary to survive the caused pandemic transition to work at home.


Evgeny Cherkesov

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