AMD has had an exciting year so far. They are back in the processor game and RX VEGA is on the horizon. AMD will announce Q2 financial results on the 25th of July so lets wildly speculate on what we might see.
First off lets have a look at Q1 results:
AMD showed themselves slightly down from Q4 2016 but up from the same period the year before. This result likely didn’t include much of the Ryzen sales and didn’t include the current miner boom that is occurring thanks to ethereum mining.
Lets start with the graphics cards as that is the latest thing to hit the news thanks to the release of VEGA. The VEGA frontier edition card that I have written up here has now been on the market a couple of weeks but unfortunately hasn’t turned many heads. The card isn’t sold out anywhere and consumers and reviewers alike are struggling to figure out exactly where it fits in. I touch on this in my write up but there is no doubt that the frontier edition card is a very niche card that doesn’t appear to have wow’ed anyone. On the bright side VEGA will be found in the new mac pro so at least they will sell cards there.
Where VEGA has failed Polaris has been thriving. The cards are sold out everywhere thanks to the mining of a cryptocurrency called ethereum. In fact the mining craze is so big at the moment even Nvidia cards are selling out and increasing in value where normally AMD would be the number one option. This is good for AMD in that all their stocks will have been sold but investors should not expect this to have a massive effect on revenue as AMD likely has not been able to scale up production by much if at all to meet this demand. Instead sales should simply be considered ‘very strong’ on the GPU side.
Ryzen is the name for the new range of AMD consumer processors. Unlike VEGA the general consensus is that these have been a resounding success. The processors have been selling very well with Ryzen 5 1600 currently sitting in the top spot on the amazon best selling processors and the 1700, 1600x and 1500x all sitting in the top ten.
While this is excellent news for both AMD and investors the amount of profit this will have made AMD is likely still far from a peak more likely to be seen in Q3 or Q4 results. Money made from OEMs will likely be seen more in Q3 and Q4 results while money from selling the chips to consumers that build their own PCs should be seen this quarter.
The final product released in H1 of 2017 is EPYC. EPYC is likely to be AMDs big ticket item over the next year in regard to increasing income. It is an incredibly enticing product to prospective server buyers thanks to it’s competitive price:performance as well as features intel cannot currently match including 128 PCI-E lanes per processor and security features that Intel’s processors lack. The server market is also almost untapped by AMD so the only way for them is up.
EPYC is worth being very excited about but Investors should temper their expectations this quarter with EPYC likely to make more of a difference in Q3.
So in conclusion Q2 results will likely be higher than Q1 with Ryzen making an impact however may be being released on the 25th of July to take of emphasis from a potentially bad RX VEGA launch. Q3 and Q4 results should include income from ryzen in OEM products and EPYC sales respectively that should bolster AMDs revenue hopefully giving them a good profit.
Investors should potentially expect strong Q2 results but may see a rapid drop in share value a day or two later with the release of RX VEGA depending on whether AMD are masters of black magic or not. The share value will likely then recover to pre-Q2 results value over the following weeks, perhaps even higher than pre-Q2 depending on how good the results are.