AMD to sell it's Austin Texas campus

[deadrats]

http://www.reuters.com/article/2012/11/27/us-amd-blackfriday-idUSBRE8AQ12I20121127

the most damning part of the article:

"Shares of AMD rose 0.5 percent on Tuesday to close at $1.88"

i actually had to google to make sure that figure was right, it wasn't, AMD's stock as of 6:36pm 11/28/12 is actually $1.96, under $2 a share!!!

i can't help but notice that AMD's decline is directly tied to their purchase of ATI, they paid an arm and a leg for ATI and they never recouped their investment, add to that management decisions that at times seemed designed to bury the company and i don't have any confidence that AMD will be around much longer.

the moment a company needs to selling property and then lease it back in an effort to raise cash to be able to continue operations, that is the moment you stick a fork in them to see if they are done or if they still need a few minutes.

[jagabo]

The question is who is going to buy them. And will they continue making x86 CPUs.

[MOVIEGEEK]

Why don't they just issue more shares of their stock like other companies do?

If they were smart they would retool and build tablet mobo/CPU combos, that's what most people are buying these days.

http://news.cnet.com/8301-1035_3-57553868-94/tablet-display-shipments-jump-top-laptops-in-october/

[deadrats]

Why don't they just issue more shares of their stock like other companies do?

they can't just issue more stock, it would devalue the existing shares and send share prices plummeting.

If they were smart they would retool and build tablet mobo/CPU combos, that's what most people are buying these days.

what has AMD's management done in the past 4 years that would lead you to believe that any of them is smart, except for all the top brass that milk AMD out of hefty salaries as long as they could and then bailed.

[deadrats]

The question is who is going to buy them. And will they continue making x86 CPUs.

they would make a nice acquisition for apple, i could have sworn that i read somewhere that ARM was interested, it would also be a nice buy for Red Hat, AMD's cap is only about 1.4 billion, Red Hat has that much in cash, they could buy up AMD and offer complete turn key super computers and HPC systems, 2 markets that are very lucrative.

but i would be very surprised, baring some pity cash infusion, maybe from intel, if AMD was around in a few years.

[filmboss80]

Try not to read more into this than it really is. Businesses often seek ways to get quick cash infusions to fund major projects using other means than selling stock -- which divides ownership of the company itself. In this case, the asset is prime real estate. By selling it, they get a huge lump sum of capital to work with, and then they pay monthly or quarterly lease payments to stay on the property. If the economic situation in the future works out as they hope, they can try to buy the land back--for a higher price, perhaps, but it would likely not be much more than interest on a loan. If things don't pan out, they can always move to a cheaper location.

It's actually a very, very smart business move in uncertain economic times, and investors are recognizing the intelligence behind it.

[MilesAhead]

Since they are the main competition for Intel it's likely the government would "encourage" Intel to prop them up if they were on the brink of failure. Kind of like the Microsoft infusion of funds into Borland back in the day.

[aedipuss]

amd was "done" when they sold all the foundries that makes their chips. they are a non-entity at this point.

[jagabo]

amd was "done" when they sold all the foundries that makes their chips.

That's pretty much what I thought when they made the sale. Losing control of such an important part of CPU design and manufacturing was a bad sign. Of course, like selling their Austin facility now, they had to do it to remain solvent.

[aedipuss]

yeah they had to make sure all those executive golden parachutes were fully loaded. screw the employees, they can work for peanuts for their new abu dabi(sp) bosses :-\

[jman98]

i can't help but notice that AMD's decline is directly tied to their purchase of ATI, they paid an arm and a leg for ATI and they never recouped their investment, add to that management decisions that at times seemed designed to bury the company and i don't have any confidence that AMD will be around much longer.

This is correct and well said. They gambled that hybrid CPU/GPU was where the industry was going and given Intel's subpar performance in graphics, they viewed this as a way to get a leg up on Intel. It didn't really work out like they wanted. And management incompetence didn't help. The problem with AMD is that given their low market share and the unfair public perception by non-techies that anything that doesn't say "Intel" on it is crap, they can't afford to not hit a home run every time they come to the plate. Whatever the ATI purchase was, it was not a home run.

[filmboss80]

I would not pretend to know enough about AMD's history or methods of operation to make any sort of judgment on the wisdom, or lack thereof, of past decisions; but in terms of this current cash-infusion method, I must offer kudos. Had they taken out a loan or dumped stock, their backers or investors would have been the ones to incur risk. But by selling off their own real estate, and in turn making periodic lease payments to the new owner for the right to continue operating at that location, there is no outstanding debt to pay off. The new property holder already has the asset in hand. If AMD's venture should fail, they can walk away without defaulting on an outstanding loan.

AMD used their own assets to buy themselves, and their employees, some more time. AMD would bear the brunt of the loss if things didn't work out. (And this serves as an incentive to get things right.) In this instance, there is no lender that would be left holding the bag, should things take a bad turn. This action demonstrates fiscal responsibility on the part of AMD, and the investment market seems to be reacting to this decision positively.

Unlike the f---tards at General Motors and other companies that saddled American taxpayers with bailout burdens, AMD sacrificed something they owned in order to pay for a future from their own pocket. I respect that. Can you imagine a government entity like the Postal Service doing that?

Death pronouncements over AMD at this point may be as premature as similar declarations about Apple during the 1990s. Who knows? We'll just wait and see how things pan out. In the meantime, my hat's off to them for finding smart and responsible ways to solve their problems using their own resources. I have more hope for this company's recovery than I do for most others that are currently struggling.

[deadrats]

Unlike the f---tards at General Motors and other companies that saddled American taxpayers with bailout burdens, AMD sacrificed something they owned in order to pay for a future from their own pocket. I respect that. Can you imagine a government entity like the Postal Service doing that?

actually this is a misconception that continues to be held by the majority of the public, GM has already paid back the loan, the loan agreement called for the bailout money to be paid back in cash and stocks and the total cash amount owed was paid off back in 2010 as was the stock, the only thing that hasn't played along is GM's stock, the government still owns a bunch of GM's shares and the shares need to hit about $53 a share in order for the government to break even, as of today GM's stock prices are just under $26, assuming the economy picks up and people start buying cars again, when GM's stock goes back up (and i think it will in a few years), the government will actually make a nice profit on the deal.

Death pronouncements over AMD at this point may be as premature as similar declarations about Apple during the 1990s. Who knows? We'll just wait and see how things pan out. In the meantime, my hat's off to them for finding smart and responsible ways to solve their problems using their own resources. I have more hope for this company's recovery than I do for most others that are currently struggling.

you do remember what saved apple, don't you? it wasn't steve, it was microsoft giving a shitload of cash, now if intel decides to prop up amd with a few billion then yes AMD will survive and hopefully flourish but i think it's more likely someone buys up their IP, liquidates their assets to pay off all AMD's outstanding debt and AMD goes the way of 3dfx.

[jagabo]

this is a misconception... the only thing that hasn't played along is GM's stock, the government still owns a bunch of GM's shares and the shares need to hit about $53 a share in order for the government to break even

Until GM has bought the stock back at $53 a share, or the stock rises to that price, it's not a misconception. We're talking about $26 billion (at $53 a share)

you do remember what saved apple, don't you? it wasn't steve, it was microsoft giving a shitload of cash

Yes. And porting Office to the Mac.

[JimmyS]

you do remember what saved apple, don't you? it wasn't steve, it was microsoft giving a shitload of cash....

There is still a lot of misinformation regarding this issue from what I remember from the news regarding this subject. Timeframe: Jobs has returned to Apple and has Iniatiated his coup and now is acting CEO. During his "resettlement" at Apple, Jobs has been shown overwhelming evidence that MS has been blatently pilfering Apple code for WinXP. Shortly before the debut of the original iMac, Jobs calls Gates and informs him he is aware of MS's actions, and gives him two options. A protracted legal battle in which he was assured that Apple would win, and the settlement could reach into the billion$. Or, make an agreement where Apple and MS enter into a complete patent and technology information exchange for five years, MS would commit to continue developing Office for Mac for a minimum of five years and the kicker was, as a gesture of good faith, at the debut of the iMac, Gates would announce that MS was investing (not giving) the aforementioned shitload of cash ($150,000,000) in Apple. The stipulation set in the aggrement was that the money was for non-voting shares and MS had to hold them for a minimum of two years, which you never hear mentioned. As far as saving the company, not really. It gave Apple enough cash to function while the iMac built up momentum. It was a resounding success. Tim Cooks total revamping of the inventory and supply side of Apple made another huge financial impact for the company. Apple again had good cash flow due to Job's product vision and no longer had write off huge amounts of money for excess inventory whenever a new product came out (now days worth instead of months) and also had much better contracts with far fewer suppliers thanks to Cook. That is what really saved the company in the long term.

[filmboss80]

Unlike the f---tards at General Motors and other companies that saddled American taxpayers with bailout burdens, AMD sacrificed something they owned in order to pay for a future from their own pocket. I respect that. Can you imagine a government entity like the Postal Service doing that?

actually this is a misconception that continues to be held by the majority of the public, GM has already paid back the loan, the loan agreement called for the bailout money to be paid back in cash and stocks and the total cash amount owed was paid off back in 2010 as was the stock, the only thing that hasn't played along is GM's stock, the government still owns a bunch of GM's shares and the shares need to hit about $53 a share in order for the government to break even, as of today GM's stock prices are just under $26, assuming the economy picks up and people start buying cars again, when GM's stock goes back up (and i think it will in a few years), the government will actually make a nice profit on the deal.

Death pronouncements over AMD at this point may be as premature as similar declarations about Apple during the 1990s. Who knows? We'll just wait and see how things pan out. In the meantime, my hat's off to them for finding smart and responsible ways to solve their problems using their own resources. I have more hope for this company's recovery than I do for most others that are currently struggling.

you do remember what saved apple, don't you? it wasn't steve, it was microsoft giving a shitload of cash, now if intel decides to prop up amd with a few billion then yes AMD will survive and hopefully flourish but i think it's more likely someone buys up their IP, liquidates their assets to pay off all AMD's outstanding debt and AMD goes the way of 3dfx.

I invite you to re-read my post, which never said GM didn't pay back their TARP bailout money (although you can get the full gist of what actually happened by scrolling down to the Complete Answer section of http://factcheck.org/2010/05/general-motors-debt/index.html) The point which you seem to have completely missed is that AMD, unlike GM, is trying to address an adverse economic situation in a way that does not extend the financial risk outside the company. What if GM could not have paid back the most substantial portion of their debt? What if the stock doesn't reach the $53/share mark in a timely fashion? (It certainly hasn't yet, and GM is not nearly as healthy as they claim to be.) Regardless of the outcome, the risk had been laid upon the taxpayers at the beginning. That was my point.

As for the Apple example, the point was not at all about how they recovered, or who helped them, but simply that none of us should jump the gun in pronouncing a company's doom, simply because they're facing a period of adversity. (And sooner or later, most businesses go through adverse periods.)

It might behoove you to take the time to actually read the content of what people post, instead of rapidly scanning these items and being so quick on the trigger to argue against points no one ever made.

[orsetto]

you do remember what saved apple, don't you? it wasn't steve, it was microsoft giving a shitload of cash....

There is still a lot of misinformation regarding this issue from what I remember from the news regarding this subject. [...] Apple and MS enter into a complete patent and technology information exchange for five years, MS would commit to continue developing Office for Mac for a minimum of five years and the kicker was, as a gesture of good faith, at the debut of the iMac, Gates would announce that MS was investing (not giving) the aforementioned shitload of cash ($150,000,000) in Apple. [...]As far as saving the company, not really. It gave Apple enough cash to function while the iMac built up momentum.

What you say is mostly what happened, but the thing people forget is that Apple was not even remotely out of money or strapped for cash at the time. They have never had less than a billion dollars in cash reserves, for most of the 90s it was closer to two billion, which in those days was a sh!tload of money for any company. Most of the handwringing about Apple's "imminent demise" in the mid-90s came from idiot Wall Street with its passel of institutional weasel investors that were at their peak of greed and unrealistic expectations (if companies in the mid-90s weren't getting 30% year-on-year growth, Wall Street Cassandras would relentlessly undermine them with whining about "poor earnings" even if they were blue-chip firms that had been around for 100 years with consistent performance). These stock market connivers irreparably damaged many otherwise-solid companies that screwed themselves trying to please these dolts.

Apple hit the worst speed bump in its history right about this time: its consumer division basically tanked because they just could not figure a way to communicate why Joe Average would want a Mac instead of Windows 95. Professional users were all over Mac, that segment was still strong, but consumers of the day didn't really mess with PhotoShop, Quark and other pro apps that shined in a Mac-centric workflow. Microsoft had very effectively instilled the idea that "Mac is dead, Win95 matches every interface feature: unless you're retouching Cindy Crawford, Mac is relegated to total niche status." The atrocious code of Mac Office 95 pretty much killed momentum in the Mac corporate market, another MS-supplied nail in the coffin. And John Sculley had run the company into the ground, with widely-publicized mega-million-$ debacles like the ruinous Newton project.

The faceless, nameless grey suits that followed him as CEO (Gil Amelio & Michael Spindler) did nothing to placate Wall Street, they had no clue or charisma or strategy, so Apple lapsed into a pointless spiral of cost-cutting in a doomed effort to compete with generic PCs. The desktops and notebooks became ugly and bland, with none of the earlier design edge and craftsmanship. Apple could not move Mac OS into the millenium no matter how hard it tried, and blew thru millions in the attempt. Everything that made Mac OS a tidy, intuitive, consistent interface for pro graphics tasks resisted conversion into a "modern" OS that could match Windows NT for corporate development purposes (which is why OSX is a horror show in some respects, still inferior to the ancient "Classic Mac OS").

There was no way the company would vanish without a trace, not with a larger cash reserve than some third-world countries: all the "demise" hysteria was ridiculous and tied strictly to stock price manipulations. The company would absolutely have continued as a specialist vendor to graphics professionals, although perhaps like Silicon Graphics would not have survived against Windows NT and XP. Whatever the motivation, Bill Gates did in fact staunch the bleeding with his very public five year promise to support and develop Office For Mac (the fact that the existing Office Mac was so horrendous and had caused Apple's ouster from Corporate America was conveniently overlooked by everyone). Bill Gates was God to Wall Street then, throwing his weight behind Mac did much to ensure survival long enough to do a turnaround. You would not believe how many "Apple Is Dead" articles cited the impending withdrawal of MS Mac Office: the Office suite was the only thing keeping Macs relevant to anyone who didn't work in advertising or publishing.

The turnaround began with the Hail Mary pass of luring Jobs back to get their hands on his NeXTstep in a last-ditch attempt to compete with Windows NT. Jobs pulled the plug on the messy, decade-late "Mac Clone" program and all Macs went back to in-house production. The iMac sensationally repackaged the consumer level Mac and made it appealing again, setting the stage for the now-endless "style over substance" debates. But really it was the fluke runaway success of the iPod that "saved" Apple in the sense of making it culturally popular, profitable, and ahead of MS in a key category. iPod led to iPhone and iPad, which dragged the laptop and desktop Macs after them as home-bound accessory docks. I've had Macs in my arsenal since the '80s, they were absolutely vital in certain fields ten years ago but today even the staunchest Mac user is delusional if they think Apple is anything other than "the iPhone/iPad Company."

Public interest in Macs would dry up in a heartbeat without the borrowed halo of the i-products: in most respects Windows 7 and Mac OSX are effectively equal, and OSX has really blown some key points all to hell the last couple of releases. Apple is once again chasing crack pipe dreams of pumping consumer Mac sales, at the expense of pros who are the only ones still beholden to Mac laptops. The killing of FireWire ports, in favor of a Thunderbolt nobody asked for or wanted but Steve Jobs, destroyed the last remaining advantage of MacBooks for pro photographers- why pay double for a Mac with no FireWire when you can buy a Windows notebook with no FireWire? (Thunderbolt to FireWire adapters aren't as seamless as we were promised, function and reliability is sacrificed.) No matter what happens, the infamous Apple cash hoard will always be the 800-lb gorilla in the room that everyone inexplicably ignores: if sales of the iPhone, iPad, and all Macs completely stalled tomorrow, never to return, Apple itself could sit motionless in a corner thru the next century, quietly counting its cash reserve. Its always been a very strange company, condemned as either "too niche' or "out of touch" or " too dependent on style," all the while sitting on more money than most world banks.

None of which has anything whatever to do with AMD's sale-leaseback of its office properties: JimmyS post just triggered my memories of all the mid-90s Apple vinegar.

[aedipuss]

reads like apple fanboy revisionist history. as bad as jobs and woz weren't felonious criminals in the 70's.

[JimmyS]

reads like apple fanboy revisionist history. as bad as jobs and woz weren't felonious criminals in the 70's.

If I remember right, this is in respect to comments made in regard to The two Steves blue box exploits, where they sold "illegal" equipment to circumvent the phone system and make free calls. Phone phreaking in the 70's was looked at the time basically the same as the "illegal" file sharing of today. If that is the case, then anyone who has ever "illegalily" shared or downloaded any one elses copyrighted material for free is just as guilty. Might you be one of those criminals? I know I could possibly charged as one. But, I profess, Not Guilty. Also if I remember correctly (it was a few years ago, so gimme a break) most of the info came from the online publication of MacWeek (Ziff-Davis publishing).

As far as ther profits going to help fund Apple Computer Company, (not to be confused with Apple Computer Inc.), the bluebox thing happened a couple years before that. According to interviews with Woz, Jobs took the money he made and put it into the farm commune he was frequenting at the time.

[JimmyS]

...None of which has anything whatever to do with AMD's sale-leaseback of its office properties: JimmyS post just triggered my memories of all the mid-90s Apple vinegar.

Thats for sure. Apples former plight doesn't have any relevance to this. It sure has been a facinating adventure though. There is currently a small link some what relating to this, as you have probably seen some of the storys asking "Should Apple buy AMD?" I think that if that were to happen, it could result in one huge cluster f***. Right now, Apple needs fab capacity as they transition there SOC's away from Samsung, and AMD no longer has any.

As far as AMD's real estate situation goes, it is becoming fairly common for companys to do this. Especially if they need some quick cash. Also in the event that they may have to pick up and move or that their situation puts them on the critical list, they don't have to worry about liquidating a bunch real estate.

[MOVIEGEEK]

reads like apple fanboy revisionist history. as bad as jobs and woz weren't felonious criminals in the 70's.

..and Apple Computers promising Apple Records in 1981 they would never get in the music business.

[Hoser Rob]

amd's problems go beyond this campus deal ... last year they laid off about 1500 employees ans when their CEO left it took 7 months to find someone else. That's never a good sign.

They're well down the road to irrelevancy. ARM is the new amd.

[JimmyS]

reads like apple fanboy revisionist history. as bad as jobs and woz weren't felonious criminals in the 70's.

..and Apple Computers promising Apple Records in 1981 they would never get in the music business.

Who could have known how much music and computers would become so intertwined in the future. It appears as though even the great prognosticator Stevie Jobs didn't realize it then. Recorded music went through a great paradigm shift and Apple was willing to pay the financial consequences of its decisions to follow its new instincts. But in the end, everything came up roses for Apple Corps. The Beatles are selling millions and millions of their songs on iTunes and Apple Corps became considerably more wealthy after Apple Inc. bought the all the necessary trademark and music rights from them, thus ending all legal disputes.

[jagabo]

Advanced Micro Devices... has reduced its chip manufacturing orders for the last three months of the company's 2012 fiscal year by more than 75 percent

http://arstechnica.com/information-technology/2012/12/amd-puts-brakes-on-chip-manufact...ales-plummmet/

[aedipuss]

Advanced Micro Devices... has reduced its chip manufacturing orders for the last three months of the company's 2012 fiscal year by more than 75 percent

http://arstechnica.com/information-technology/2012/12/amd-puts-brakes-on-chip-manufact...ales-plummmet/

what kind of weird freaking economics is that? they reduced their chip order from $500mil to 115mil but with a 320mil penalty. so for 435mil they are getting 115mil of product? holy **** the current management is clueless! now they are going to have to sell the 115mil of chips for 4 times as much to make a profit. they can't sell what they have at the current prices, how are they going to increase them by a factor of 4? at least if they bought the original order of 500mil they'd have lots of cheap chips to sell if things pick up.

[deadrats]

what kind of weird freaking economics is that? they reduced their chip order from $500mil to 115mil but with a 320mil penalty. so for 435mil they are getting 115mil of product? holy **** the current management is clueless! now they are going to have to sell the 115mil of chips for 4 times as much to make a profit. they can't sell what they have at the current prices, how are they going to increase them by a factor of 4? at least if they bought the original order of 500mil they'd have lots of cheap chips to sell if things pick up.

AMD had a contractual obligation to buy 500 million worth of wafers, they paid a 320 million dollar penalty renegotiate the terms of the contract and now only have to buy 115 million dollars worth of wafers, a net savings of 65 million dollars and going forward their savings will continue as they are now contractually obligated to buy significantly less wafers than previously.

it's a sign of a company desperately trying to remain afloat, a slow global economy, a general decline in demand for faster computer hardware (because let's be honest with ourselves, for most non-power users pc's are fast enough as it is), poor management and poor performing products for the last 4 years or so and AMD needs to do everything they can to remain solvent, like laying off huge amounts of their workforce, selling property and renegotiating contracts.

i still see them filing for bankruptcy protection sometime in 2013.

[jagabo]

And it gets worse:

$1bn loss in 2012

http://www.theinquirer.net/inquirer/news/2238452/amd-slumps-to-a-usd1bn-loss-after-dis...fourth-quarter

Has anyone noticed that Intel's prices have hardly changed in the last year? They used to drop every quarter, like clockwork.

[ranchhand]

Yeah, and as soon as AMD procs disappear off retail/online store shelves, watch what happens to Intel's CPU prices. They are rubbing their hands together. Too bad.

[jman98]

Intel is suffering too. Sales are down and while they are certainly not going out of business any time soon, there is a lot of speculation that the popularity of ARM based devices has completely caught them off guard.

AMD cut their losses better than expected. That is one of the problems of the stock market - the exact same news will be read completely differently by different analysts. The following suggests that AMD is a bit of a coin flip but they MIGHT be heading in the right direction.
http://wallstcheatsheet.com/stocks/will-amd-be-the-turnaround-story-of-2013.html/?ref=YF

[aedipuss]

intel is moving further away from desktops and will stop manufacturing motherboards.
http://www.itproportal.com/2013/01/23/intel-to-shut-down-retail-motherboard-arm-and-sh...king-products/