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Outcome of AMD: what to expect

Advanced Micro Devices Inc. is the chip maker to monitor this season's results, while the company attacks Intel Corp. and Nvidia Corp., while problems in the sector should show signs of improvement.


AMD + 3.55%

is expected to release its second quarter results on Wednesday, July 24.

What to expect

Earnings: Of the 29 analysts surveyed by FactSet, AMD is expected to post an average adjusted earnings of 8 cents per share, down from 9 cents per share expected at the beginning of the quarter. Estimize, a software platform that leverages crowdsourcing of hedge fund executives, brokerages, buy-side analysts and others, claims a profit of 9 cents per share.

Returned: Wall Street expects a turnover of 1.52 billion US dollars, according to 28 analysts surveyed by FactSet. AMD expects a turnover of between 1.47 and 1.57 billion dollars. Estimize forecasts revenue of $ 1.54 billion.

Movement of stock: AMD shares have increased more than 24% since the last profit announced by the company. In comparison, the S & P 500 index

SPX, + 0.02%

gained 2.3%, the Nasdaq Composite Index, a technology at the cutting edge of technology

COMP + 0.17%

grew by 2.6% and the PHLX Semiconductor

SOX, + 0.77%

decreased by 2.6% during this period.

Of the 34 analysts who cover AMD, 15 have a purchase or overweight rating, 15 have a holding rating and four have an odds or underweight, with an average price target of $ 30.28, 12% lower than the record close of $ 34.39.

What to look for in the call

At the beginning of the year, AMD had a better year than other chip makers, but research companies Gartner and IDC reported an increase in global PC shipments for the second quarter.

"Although we believe that there are still risks for the personal computer markets (and other end markets for electronics), we believe that these latest estimates have a positive impact on Intel.

INTC, + 0.40%

and AMD, "commented David Wong, an analyst at Instinet recently. "In addition, we anticipate that the new Intel and AMD products may well further stimulate the end markets for personal computers and servers in the second half of this year."

For more: The hurry to beat Chinese tariffs pushes PCs shipments up, but that could bode badly for the rest of 2019

AMD recently launched its Ryzen desktop processors and APUs as well as its new Navi GPUs. These sales will be included in the outlook for the third quarter. Wong bought ratings from AMD and Intel.

Christopher Rolland, an analyst at Susquehanna Financial Group, who has neutral ratings on AMD and Intel, said AMD had already gained market share before its recent product launches.

"AMD launched its first 7nm Ryzen processors on July 7, but has already reached 19.1% of desktop computers in 2Q19 (the largest share in 5 years)," said Rolland. "To combat these gains in market share, we learned (during our recent trip to Asia) that Intel was offering price reductions of up to 15% on its Coffee Lake processors."

Overview of the technical gains: A test in a tumultuous period and all the chips are on the table

In the language of chips, nanometers, or nm, refers to the size of transistors that go on a computer chip, the general rule being that smaller transistors are faster and more efficient in terms of power consumption. 39; energy.

In addition, AMD announced a price reduction of its Radeon 5700 series graphics card just days after

NVDA, -0.20%

announced a series of competing cards in the arms race between the two companies.

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