When Advanced Micro Devices (AMD) reports quarterly earnings next week, Holders Club’s results won’t be as bad as the dismal numbers for longtime rival Intel (INTC). AMD’s quarter is far from perfect and could even be underwhelming in some areas. The semiconductor market — especially in the personal computer segment where both AMD and Intel operate — remains challenging overall. But Intel’s level of frustration stems from many company-specific factors, including the loss of market share to peer-to-peer chipmakers like AMD. That’s an important distinction that Friday’s stock moves seem to reflect. Shares of Intel fell more than 7%, to less than $28 a share. Meanwhile, AMD bounced off small losses early in the session to gain more than 1% to around $76 a share. What the club thinks We are certainly cautious on AMD and believe that investors should wait before buying more stock as reflected by our 2 rating. But this was the case before Intel’s dreaded worse earnings were announced after the closing bell on Thursday. Before moving into a more bullish trend, we want to be clear on when AMD’s profits will no longer be squeezed by an inventory glut. This multi-quarter, industry-wide issue is likely to show up in fourth-quarter results AMD is expected to release after the close of trading on Tuesday. The company’s forward guidance will give an indication of when margin pressure will ease. At the same time, the overall picture is clear. AMD has gained the upper hand in the competition with Intel. Under CEO Lisa Su, the chip designer has built a track record of consistent execution and technology development that outperforms Intel. It puts AMD in a position to be one of the leaders of the semiconductor industry’s ultimate recovery. AMD INTC 5Y mountain Advanced Micro Devices (AMD) performance versus Intel (INTC) over the past 5 years What Wall Street has to say about Intel a series of key Wall Street research notes. Stacy Rasgon, a prominent semiconductor analyst at Bernstein, writes: “We’ve written the phrase ‘Worst earnings report in the history of tracking this company’ more than once in the past few years. But this time around. we REALLY want to say it.” For the three months ended December 31, Intel earned adjusted 10 cents per share, compared with an EPS estimate of 20 cents, according to Refinitiv. Revenue fell 32% year-on-year to $14.04 billion, below expectations of $14.45 billion. The company’s first-quarter forecast was even worse in analysts’ minds. According to Refinitiv, Intel guided or adjusted a loss of 15 cents per share in the first quarter, when analysts expected earnings of 24 cents. The chipmaker’s first-quarter revenue estimate was between $10.5 billion and $11.5 billion, well below the consensus estimate of $13.93 billion. Analysts at Morgan Stanley wrote in a note to clients: “While we prepared for a weaker number and cut our estimate in our preview, the level of guidance is weak. than that was quite surprising to both us and the investors we spoke to.” Many analysts also expressed concern about the sustainability of Intel’s dividend at current levels given the substantial cash flow the company is burning. In 2022, Intel paid out $6 billion in dividends to shareholders. On Thursday’s post-earnings call, Intel’s chief financial officer, David Zinsner, said the company is “committed to maintaining a competitive dividend. AMD does not pay a dividend. Implications for AMD Morgan Stanley says they believe Intel’s results are “cautious” for its peers, especially AMD.” To some extent, we think Intel’s inventory position at customers is higher than its peers, and the loss of market share in servers is a factor for them. But this clearly indicates even weaker conditions than we expected,” the analysts said. report to them.” PC sales in the first quarter fell, reducing the risk of a major instruction failure like with Intel entering the lucrative market that is central to the Club’s investment case. ” As Intel itself has proven [over a decade]Analysts wrote. (Jim Cramer’s Charitable Trust is a longtime AMD. See here for a full list of stocks.) As a CNBC Investment Club subscriber with Jim Cramer, you’ll receive a trade alert before Jim does. currently trading. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charity’s portfolio. If Jim was talking about a stock on CNBC, he waited 72 hours after issuing a trade warning OUR PRIVACY, ALSO OUR DISCLAIMER. INVESTMENT CLUB has NO SPECIFIC RESULTS OR GUARANTEED PROFITS.
Intel Foundry Services will manufacture multiple chips for MediaTek for a range of smart devices, the two companies said on Monday.
Fabian Bimmer | Reuters
When Advanced micro-devices (AMD) reports quarterly earnings next week, holdings Club results won’t be as bad as longtime rival clever‘s (INTC) the numbers are dismal.
