AMD Fails to Compete with Intel

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Announcing the company’s earnings for the previous year, AMD officials stated that they were predicting sequential increases in revenues during the current year. This is based on expected gains in PC market share, despite there being no rational or concrete basis for this kind of optimism.

Declining Results

For the last quarter of 2015, AMD showed continuing crumbling revenues, reporting results of $958 million in revenue, a staggering 23 percent decline compared to the same quarter last year. The company’s CG segment reported a nearly 30 percent drop to $470 million, while the EES segment fared somewhat better with only a 15 percent drop in revenue to $488 million.

In the report covering the entire year, the revenues recorded a drop of 28 percent, coming in just short of $4 billion, while operating losses swelled to an astounding $481 million when compared to $155 million in 2014. Equally as worrisome is the fact that total CC revenue for the entire year fell by 42 percent, while operating losses blew up nearly seven times to $502 million compared to only $76 million recorded for 2014. Year on year, EES is the only division managing to somewhat hold its own by showing only an 8 percent drop in revenue.

Justified Skepticism

When observing AMD’s number, and taking into account the ongoing decline in the PC market, it is clear that Intel has succeeded in keeping its revenue stream consistent by taking away market share from AMD.

This has prompted many analysts to be justifiably skeptical about the announced market share growth, commenting that AMD’s much hyped Zen x86 architecture is not expected to arrive on the market until the second half of the year. This fact is leaving many people baffled, on where the early growth predicted by AMD officials for this year is expected to come from.

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