1/17/19 AMD 19.49 to 20.25

TSMC reported overnight. Guided lower due to smartphone slow down. Stated major under-utilization of 7 nm capacity. Actually this is good for AMD. More capacity to ramp up, don’t have to fight Apple.


Rumor that Navi will announce at E3. Ship in July. If true, it would be great.


Wells Fargo’s Aaron Rakers reiterate outperform and price target of 30.

Rakers noted, “With an expectation that AMD’s 14nm Naples EPYC CPUs can garner continued share gains in the cloud vertical, we model Enterprise revenue to grow to ~$200-$250M/quarter in 1H2019, followed by an anticipated strong 7nm Rome EPYC driven ramp to ~$380M and $450M+ in 3Q19 and 4Q19, respectively. This reflects estimates that AMD’s server unit share will grow to ~10%-12% in 2H2019; using a blended ~$700 ASP ($/CPU) – using IDC’s CPU shipment estimates […] AMD’s server strength into 2019 remains a key focus as we / investors gauge the ramp of the company’s 64-core / 128-thread 7nm Rome EPYC CPUs.”

The analyst modestly reduced his 4Q18 revenue and EPS estimates from $1.456 billion and $0.09 to $1.411 billion and $0.08, respectively. The analyst also adjusted his 1Q19 estimates from $1.577B /$0.14 to $1.375B / $0.07. He adjusted his 2019 and 2020 estimates from $6.988B / $0.77 and $7.420B / $0.86 to $6.862B / $0.71 and $7.354B / $0.85, respectively (vs. street @ $6.942B / $0.62 and $8.070B / $0.96).

However, this doesn’t account for Ryzen 3rd gen, Navi and Ryzen Mobile 2nd gen. I think 2020 revenue projection of $7.35B or even $8.0B is incredibly low, considering by 2020 there will definitely be PS 5, new XBOX, Epyc 3 (Milan), Ryzen Mobile 3rd gen, top range Navi, Ryzen 4th gen, not to mention autopilot, MS Surface, CPU in Apple etc etc.

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