AMD stock value on the rise following buyout chatter

By on August 9, 2012, 11:00 AM

Shares in Advanced Micro Devices are on the rise following speculation that the semiconductor company could be headed for a buyout. Share value shot up roughly 8 percent yesterday afternoon, topping out at $4.46 before dropping slightly to close the day.  Qualcomm and Samsung have both been mentioned as potential suitors but even still, some analysts feel that an acquisition of AMD is unlikely.

Sylvie Barak from EE Times published an article last week that looked into which company might be the best fit to acquire AMD. First on the list was Intel rival Qualcomm, a viable option as they purchased AMD’s handheld GPU division in 2008 for a cool $65 million. The chip maker has no short-term plans to enter the enterprise or server markets but an acquisition could give them more leverage with manufacturing partners Globalfoundries and Taiwan Semiconductor Manufacturing Company (TSMC).

Rumors have been swirling for some time that Samsung could be interested in acquiring fledgling handset maker RIM but their name is also being considered for a buyout of AMD. The Korean company has already hired away several top silicon designers from AMD but a full acquisition would mean access to all of the chip maker’s patents, a huge boon for Samsung in their fight against Apple. They are also one of the few companies that could buy AMD outright without making a dent in their cash reserves.

It likely wouldn’t come as a surprise to many if AMD threw in the towel at some point in the near future. They have had a tough time turning a profit lately and just earlier this week, announced they had taken out a loan for $300 million to, in part, repay previous debt.




User Comments: 25

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Nima304 said:

I remember when companies acquired other companies to expand their services, not to gain leverage or patents to use against other corporations.

Ranger12 Ranger12 said:

I've never really cared for AMD processors although I must say I think they were much more competitive in previous years than they have been lately. I have been a bit of a fanboy of the Radeon GPU's although admittedly their quality fluctuates from series to series. So I'm not really concerned about the processor line although I think it is important for Intel to have a major contender so as to keep the prices in check and a reason to emphasize development. I guess in the end I'd rather see Qualcomm make a move because they are more specialized than Samsung who has a large range of products and may not give processors the attention or specialty they deserve.

Ranger1st Ranger1st said:

Just as long as someone is out there applying pressure to INTEL, last I need is the 'arrogant dark side' running willy nilly with pricing. It's bad enough already. Every time I own an Intel processor I feel.. dirty.

MilwaukeeMike said:

Just as long as someone is out there applying pressure to INTEL, last I need is the 'arrogant dark side' running willy nilly with pricing. It's bad enough already. Every time I own an Intel processor I feel.. dirty.

And everytime you buy a new Intel processor you have to buy a new board to put it in. At least AMD has the decency to hold onto a socket for more than 1 CPU cycle.

Personally I've built more PCs with AMD than intel. AMD provides great performance for the price if you're building a computer for simple uses.

h4expo said:

You know the industry is screwed up when a OEM vendor is capable of buying out the company that provides the necessary hardware to make their product function.

princeton princeton said:

Just as long as someone is out there applying pressure to INTEL, last I need is the 'arrogant dark side' running willy nilly with pricing. It's bad enough already. Every time I own an Intel processor I feel.. dirty.

And everytime you buy a new Intel processor you have to buy a new board to put it in. At least AMD has the decency to hold onto a socket for more than 1 CPU cycle.

Personally I've built more PCs with AMD than intel. AMD provides great performance for the price if you're building a computer for simple uses.

Intel does that because they move forward unlike AMD. There are always changes that REQUIRE a socket change. For example Intel didn't make LGA 1155 just because the felt like it, the change was needed due to the northbridge being integrated onto the CPU and changes to the IGP. It has nothing to do with decency. Look where sticking with AM3 got AMD, soon a buyout of their CPU division would be considered toxic. They're doing good on the GPU front but it appears that that's not going to keep them afloat.

Guest said:

Or for advanced gaming as well. $/buck Inhell simply can't touch em still.. though I do miss the K7/8 days

Guest said:

/facepalm says it all for the Inhell fanboi

sapo joe said:

Just as long as someone is out there applying pressure to INTEL, last I need is the 'arrogant dark side' running willy nilly with pricing. It's bad enough already. Every time I own an Intel processor I feel.. dirty.

And everytime you buy a new Intel processor you have to buy a new board to put it in. At least AMD has the decency to hold onto a socket for more than 1 CPU cycle.

Personally I've built more PCs with AMD than intel. AMD provides great performance for the price if you're building a computer for simple uses.

Intel does that because they move forward unlike AMD. There are always changes that REQUIRE a socket change. For example Intel didn't make LGA 1155 just because the felt like it, the change was needed due to the northbridge being integrated onto the CPU and changes to the IGP. It has nothing to do with decency. Look where sticking with AM3 got AMD, soon a buyout of their CPU division would be considered toxic. They're doing good on the GPU front but it appears that that's not going to keep them afloat.

No, it shouldn't be REQUIRED to change the CPU socket on every cpu release. Intel itself used to allow upgrades without having to change the motherboard, and this obligatory changes are just a way to sell more mobos.

Be careful, nobody wants a monopoly these days, if only Intel makes processors, the prices will surely rise o a point of absurdity. Intel is already much more expensive than should be, and I'd be glad to see AMD with a really competitive processor available, like in the Athlon days.

1 person liked this | dotVezz said:

I miss the old days of AMD Desktop-sector asskickery.

The K7 was absolutely on top of the competition in every possible way. Athlon XP was very competitive, and the Athlon 64 and Athlon 64 x2 were fantastic until the Core 2 line exploded onto the scene. Since then, they just haven't been able to compete with Intel's superior performance, except in the low-end market.

The idea of AMD disappearing is hearbreaking, but if anyone can turn AMD into a phoenix metaphor, it's Samsung.

sapo joe said:

I miss the old days of AMD Desktop-sector asskickery.

The K7 was absolutely on top of the competition in every possible way. Athlon XP was very competitive, and the Athlon 64 and Athlon 64 x2 were fantastic until the Core 2 line exploded onto the scene. Since then, they just haven't been able to compete with Intel's superior performance, except in the low-end market.

The idea of AMD disappearing is hearbreaking, but if anyone can turn AMD into a phoenix metaphor, it's Samsung.

Samsung is too involved on its lawsuits, and as someone said before, they could be buying AMD just for it's patents. But I (hopefully) could be wrong. It'd be amazing to have AMD competing head to head with Intel, like it does with nVidia.

dividebyzero dividebyzero, trainee n00b, said:

And everytime you buy a new Intel processor you have to buy a new board to put it in. At least AMD has the decency to hold onto a socket for more than 1 CPU cycle.

Just as well the FM1 socket is designated for APU's then isn't it. From introduction to EOL in less than a year (paper launches notwithstanding)

No, it shouldn't be REQUIRED to change the CPU socket on every cpu release.
With the exception of LGA1156 (P55 et al) there has been the option to upgrade the CPU in any Intel socket, whether it be later steppings/revision CPU's ( 6-core Gulftown 970, 980X, 990X for LGA1366 for example), or new architectures - Sandy Bridge and Ivy Bridge for LGA1155 and Sandy Bridge-E/Ivy Bridge-E for LGA2011 being the current platforms.

I'd also be inclined to look at the larger picture here - for example, Intel recently introduced PCI-E 3.0...and a lot of (non-Intel) desktop users said a collective "so what, the 2.0 spec isn't bandwidth saturated-why worry about 3.0 " - or words to that effect. For client (desktop) users that is exactly the case in 99.9% of scenario's....for servers where bandwidth becomes paramount, the greater throughput, lower overhead, and much lower latency makes PCI-E 3.0 a no brainer - especially for cloud computing and HPC

Which brings us to...

AMD's big marketing push - HSA and cloud computing. Using Opteron and PCI-E 2.0/Hypertransport...with AMD's adoption of PCI-E 3.0 likely around 2014...around the same time that Intel starts integrating PCI-E 4.0.

bangs777 bangs777 said:

I just wish AMD could come back..people please buy AMD products.

sapo joe said:

Just as well the FM1 socket is designated for APU's then isn't it. From introduction to EOL in less than a year (paper launches notwithstanding) With the exception of LGA1156 (P55 et al) there has been the option to upgrade the CPU in any Intel socket, whether it be later steppings/revision CPU's ( 6-core Gulftown 970, 980X, 990X for LGA1366 for example), or new architectures - Sandy Bridge and Ivy Bridge for LGA1155 and Sandy Bridge-E/Ivy Bridge-E for LGA2011 being the current platforms.

I'd also be inclined to look at the larger picture here - for example, Intel recently introduced PCI-E 3.0...and a lot of (non-Intel) desktop users said a collective "so what, the 2.0 spec isn't bandwidth saturated-why worry about 3.0 " - or words to that effect. For client (desktop) users that is exactly the case in 99.9% of scenario's....for servers where bandwidth becomes paramount, the greater throughput, lower overhead, and much lower latency makes PCI-E 3.0 a no brainer - especially for cloud computing and HPC

Which brings us to...

AMD's big marketing push - HSA and cloud computing. Using Opteron and PCI-E 2.0/Hypertransport...with AMD's adoption of PCI-E 3.0 likely around 2014...around the same time that Intel starts integrating PCI-E 4.0.

Yes, we aren't even using PCI-E 2.0's full potential, specially with games( which mostly move the computer evolution) based on console counterparts, which are PCI-E 1.0 still. But, don't argue with a fan boy, you just can't win.

dividebyzero dividebyzero, trainee n00b, said:

Yes, we aren't even using PCI-E 2.0's full potential, specially with games( which mostly move the computer evolution) based on console counterparts, which are PCI-E 1.0 still. But, don't argue with a fan boy, you just can't win.

Gaming "moves computer evolution" WTF? You do realize that discrete desktop graphics sales are in the order of $3bn and the total revenue for computer hardware in 2012 is predicted to be in the order of $550-585bn? PC's might represent a sizeable percentage of overall sales/revenue- but only a fraction of PC owners are gamers.

I'm assuming that comprehension isn't your stong suit:

For client (desktop) users [2.0 spec isn't bandwidth saturated-why worry about 3.0] is exactly the case in 99.9% of scenario's....

If that remains too many words, allow me to simplify:

Desktop = PCI-E 3.0 unneeded

Server/HPC= PCI-E 3.0 needed

I'll let Anandtech elucidate:

So why is PCIe 3.0 important then? It's not the games, it's the computing. GPUs have a great deal of internal memory bandwidth (264GB/sec; more with cache) but shuffling data between the GPU and the CPU is a high latency, heavily bottlenecked process that tops out at 8GB/sec under PCIe 2.1. And since GPUs are still specialized devices that excel at parallel code execution, a lot of workloads exist that will need to constantly move data between the GPU and the CPU to maximize parallel and serial code execution. As it stands today GPUs are really only best suited for workloads that involve sending work to the GPU and keeping it there; heterogeneous computing is a luxury there isn't bandwidth for.

[source]

Now read the last bolded section of the quote and note the AMD Heterogeneous system arch push. Connect the dots.

But, don't argue with a fan boy, you just can't win.

I fully agree.

Zen Zen, TechSpot Paladin, said:

I've never really cared for AMD processors although I must say I think they were much more competitive in previous years than they have been lately.

Great, I'm so glad to hear this type of talk, especially since I'm within days of dropping $159.99 on a AMD FX-8120 8 Core processor!

Ranger12 Ranger12 said:

Great, I'm so glad to hear this type of talk, especially since I'm within days of dropping $159.99 on a AMD FX-8120 8 Core processor!

Newegg has it for 149.99 and free shipping.

princeton princeton said:

But, don't argue with a fan boy, you just can't win.

Wow you didn't even try. Resorting to labeling everyone who doesn't agree with you as a fanboy. So instead of presenting a logical argument we've gone straight to " [link] ".

Zen Zen, TechSpot Paladin, said:

Newegg has it for 149.99 and free shipping.

I'd love to buy from somewhere like Newegg.com, but my statement goes in line with the fact that Fry's Electronics is going to be my supplier, when it comes to something that I'm up to....

[link]

That link takes you to where I'm in the development stages of assembling drafts for my new computer. All the parts will be bought on the same day, at the same time with no worry about not having everything together I need on build day. The second to the last post in the topic area I feel is the final draft and come this Tuesday morning, I'll make the drive out to Fry's and pick it all up.

But thanks for the option here, maybe next time!

Ranger12 Ranger12 said:

I'm going to Frys next weekend here in Atlanta to pick up a couple parts! They have incredibly prices for a physical store.

GeforcerFX GeforcerFX said:

In my opinion AMD is right where they need to be at this time, just needs a few tweaks. The bulldozer architecture has its major perks, and can really do well in the server market do to the ability to have so many cores for so cheap. They still compete well with intel in the desktop CPU range, maybe not enthusiast range (to me that's $500-$1000 CPUS), but that's only a small fraction of PC users. Intel has the architecture, AMD has the flexibility, all AMD cpus can be overclocked in some way. Where as only Intel K chips can be overclocked and they cost more then there non K brethren. But where I finally see AMD moving ahead of intel is in the laptop and small computer department, The APU designs from AMD are remarkable, they offer amazing balance and prices for the power your getting. Looking at just the new Trinity A10 chips, 35 watts gets you a decent quad core CPU( about on par with mobile i5's) and then a amazing integrated graphics, which in some laptops can then be crossfired with a dedicated GPU as well. As programs get coded to take advantage of that APU technology and offload certain work loads onto the built in GPU, I think you could see AMD close some performance gaps for sure. There graphics are very competitive and just need better more reliable drivers and they would really help there odds on nvidia (but the market isn't split that hard at this time), not a fan boy of any company really, just think that AMD needs to stay focused on there current road plans and make the markets they want, like what intel does.

dividebyzero dividebyzero, trainee n00b, said:

^^ If existing AMD server users are upgrading their C32/G34 sockets, then Bulldozer makes some appeal. If the buyer is starting from the ground up then [link] . From what I've read, if Abu Dhabi (Piledriver), Steamroller and Excavator ALL hit their designed performance targets and are on time then forecasts are ~17-20% market share for AMD in server by 2016-17 (I.e. double their present market share)

Client (desktop/mobile) don't look that bright. Ivy Bridge is killing AMD in both segments. The fact that AMD are carrying $830 million in inventory (almost $250 million up on the last quarter) means that AMD missed the mark with OEM's with Trinity/Llano/Zambesi. Unsurprising that Intel and Nvidia gained the 13% revenue that AMD lost. AMD's APU's might be a good mix of processing and graphics, but Intel is rapidly closing the gap on the latter for most users...Haswell will likely make the difference minimal unless something radical happens in game development or screen resolution in the interim. The fact that major OEM's like Apple turn to Intel+Nvidia instead of APU and APU+ hybrid crossfire, means AMD have an fight ahead of them -and that's without taking into account the looming spectre of ARM x64.

Graphics are (and have been) AMD's saving grace for the most part. As per usual, AMD/ATI churn out great hardware- they just don't have many clues about marketing or forging long term alliances with OEM's and devs- probably because the focus shifts within AMD management too often. Personally, I'd like to see AMD merge, or be bought out by a company with some serious financial muscle and a willingness to pour cash into R&D. Failing that, AMD to spin off the graphics division (and negotiate licences for APU use) and use the capital to concentrate on processors and make a dent in the $US2.02bn debt they're carrying. AMD perpetually limping along on a shoestring budget and a self interested/disinterested board of directors isn't doing anyone any good.

BTW: The AMD buyout rumour (the basis of the article) is likely bogus. These kinds of rumours tend to "surface" whenever a stock takes a nose dive. A convenient takeover rumour has a stabilizing effect on a stock in freefall.

sapo joe said:

Gaming "moves computer evolution" WTF? You do realize that discrete desktop graphics sales are in the order of $3bn and the total revenue for computer hardware in 2012 is predicted to be in the order of $550-585bn? PC's might represent a sizeable percentage of overall sales/revenue- but only a fraction of PC owners are gamers.

I'm assuming that comprehension isn't your stong suit:

If that remains too many words, allow me to simplify:

Desktop = PCI-E 3.0 unneeded

Server/HPC= PCI-E 3.0 needed

I'll let Anandtech elucidate:

I comprehend that, yes. But I don't run any servers at home and servers are a real small percentage of built computers (even smaller than gamers), don't you agree? I mean, to the average user, PCI-E 3.0 is like running a V-8 supercharged engine to power a lawnmower...

dividebyzero dividebyzero, trainee n00b, said:

I comprehend that, yes. But I don't run any servers at home and servers are a real small percentage of built computers (even smaller than gamers), don't you agree?

You're kind of missing my point. PCI-E 3.0 isn't a must have for gamers, it isn't a must have for the average PC/mobile buyer either. It is however, a must have for OEM's - as a selling point for new systems ( telling customers that their next product release is just the same as the old stuff isn't a great selling point) and both a selling point AND must have in the server/ workstation/ datacentre/HPC markets. It's not a happy coincidence that the largest PC suppliers also happen to be the worlds largest suppliers of professional/enterprise systems (HP, Dell, Lenovo - of which, both HP and Dell have significantly higher revenue than Intel)

I've already mentioned the fact that AMD's inventory ballooned by $250 million this quarter - that isn't from DIY'ers and guys not ordering from Newegg, that's OEM's looking at AMD's product stack and saying "no thanks, we can't sell this because there's no differentiation between this stuff and the old stuff" - Trinity doesn't offer a compelling feature set over Llano, nor Zambesi over Phenom II. If you think that is a false assumption just look at OEM's product lines. Do you think it likely that if Intel keep hitting their bullet points that AMD's $830m worth of warehoused hardware is going to gain in marketability ? and if it doesn't and AMD have to cut and run, what does that do for their balance sheet and their R&D budget?

As far as servers, HPC and datacentres, PCI-E 3.0 is kind of a big deal since the performance bottleneck is latency, and while these aren't massive markets now...they will be if/when cloud computing becomes more mainstream*..which brings us back to AMD making a huge deal out of HSA...but not following through with the hardware. Why? because Bulldozer and Piledriver are a done deal and need to use an existing PCI express controller and PCI-E 3.0 will need to wait until it can be incorporated into the CPU design. All this brings us full circle - note that AMD's 800 series chipset was a 2010 release. The 900 series chipset is virtually identical to the 800's and was released last year....do you see any murmerings about a 1090X/FX, 1070 range of chipsets for this year -No. No change in feature set = No new chipset = No new selling point or marketing bullet point....You think Asus, Gigabyte, Sapphire, MSI etc will be happy (and making money) pushing existing 990/970 chipset boards into 2013 ? More to the point, how much mileage can Dell, HP, Lenovo, Acer et al get out of the same three-year-old hardware

In the greater scheme of things, PCI-E 3.0 is just an example of where AMD's marketing/sales, architects and management aren't anywhere close to being on the same page. It's a solitary example I picked to highlight a point. I could just as easily noted AMD hitching its wagon to the IBM gate first foundry process, or AMD placing an over reliance upon an ever changing spec for a server CPU to pull them out of the sh compost (that would be Bulldozer), or...well, you get the point.

Gauging a companys position by the product stack they have at the present time is a false economy, requirements change both for vendors and end users* Decisions made today won't see the light of day for around two years. This has been AMD's disadvantage for some time- the management have been reactive to market change, not a shaper of the market. And yes, that is partly due to Intel's dominance. It is also more than partly due to AMD's myopic and unenthusiastic board of directors.

Cinders Cinders, TechSpot Chancellor, said:

Frys matches competitors prices, at least they do in my area. (TX)

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