5 ms·

And Intel's share price is.... still totally fine. Wait, WFT?

by jonplackett 6y ago

yakz 6y ago
AMD has produced a "better" CPU before, it didn't result in them taking over the market for CPUs.
- kadoban 6y ago
  Their market share is already rising. They're not going to "take over", there's too much inertia everywhere for that (and there's business and tech considerations beyond raw performance), but the main reason Intel's stock didn't take a hit is that this was expected.
- x87678r 6y ago
  Intel is fighting more than just AMD though. Apple ARM chips in MacBooks, Graviton processors in AWS, ARM Chromebooks and gaming computers/consoles just going pure Nvidia/Radeon - not a lot of room for Intel.
  - vel0city 6y ago
    Intel historically hasn't been too big in the console gaming market, at least CPU-wise. Previous generations we've got players like IBM making the chips for the Xbox 360, PS3, and GameCube. AMD made the CPUs on the Xbox One and Playstation 4, along with the upcoming Xbox Series X and Playstation 5. The only somewhat modern game console I can recall with any Intel Inside was the original Xbox, with what was essentially a Pentium III Coppermine CPU. Other than that, they haven't really been a player in console gaming for nearly twenty years. They will really begin to feel the pinch from these latest Ryzen CPUs in the desktop gaming market. AMD had definitely been eating more and more of the value market, but Intel had still been holding the IPC/clock rate wins so it often had a little bit of an edge over AMD for those who don't mind to spend a little premium to get the highest framerates. This launch may make this no longer be true.
- aloknnikhil 6y ago
  Sure. But back then there was no "cloud" either. AWS alone is ramping up on AMD offerings. There's an AMD counterpart for almost every instance type today (suffixed by "a"). I think the world is a lot more ready to leverage multi-core and multi-threaded chips today than ever before.
  - borland 6y ago
    We moved some of our AWS things over to "a" instances as they were cheaper per unit of performance than the intel ones. They've been great
  - baskire 6y ago
    I see the server market skipping over and and moving to arm. The Apple silicon makes it easier for Silicon Valley Devs to use an arm ecosystem. That way dev/test/staging/prod is the same ish binaries.
- cbozeman 6y ago
  Yeah... and back then Intel was committing so many anti-trust violations that its a miracle the DOJ didn't litigate them into oblivion. Fortunately, they were paid up with the right people, apparently, and the DOJ was laser-focused on Microsoft.
- TeeMassive 6y ago
  Exactly. They are huge in the server / enterprise market. Good luck convincing your boomer boss switching to anything else than the overpriced "enterprise-grade hardware". And that's not even mentioning their compiler.
  - luckman212 6y ago
    Please don't say "boomer" here. Can you make your point without resorting to ageism and bigotry?
  - m463 6y ago
    "why is this gate here, let's rip it out!" I've worked a lot of places where there was consumer grade and enterprise grade. Sometimes the distinction was more on the marketing side of the scale sometimes less so. But the enterprise customers always got WAY better service. If you're running a business chaos is your enemy and it is costly.
  - kmonsen 6y ago
    Lenovo just release enterprise workstation with threadrippers. Just ordered a few P620s for the team. They are compilation monsters.
dfdz 6y ago
Intel Revenue US$71.9B (2019) Intel Mkt cap US$226.98B AMD Revenue US$6.48B(2019) AMD Mkt cap US$101.57B (AMD stock is too high imo) Source: wikipedia and google search Edit: for 2020 AMD proj revenue growth 32% Intel proj revenue growth 4%
- xur17 6y ago
  How does revenue growth compare though?
- TheBigSalad 6y ago
  It sounds more like Intel's market cap is too low.
  - jjoonathan 6y ago
    Revenue is backwards-looking, the expected value of future earnings is forwards-looking. Investors correctly expect a rough few years ahead. The worst is almost certainly yet to come, even if you're optimistic long-term.
- jonplackett 6y ago
  Exactly - look at growth. Intel is mostly just running on momentum. It will take a long time for them to slow down. but what if next year they still don't have their new shrunk node ready, and AMD, Apple and all ARM chips are on 5nm, 3nm... If that happens, intel will be forced to outsource their designs, probably to TSMC and at that point intel as we currently know it is gone.
owenmarshall 6y ago
The downside is priced in. Stock changes now are about expectations for future releases. The market has bet that Zen 3 will be good (short term) and Intel will regain ground over the long term.
- deleted 6y ago
  [deleted]
- late2part 6y ago
  I gently disagree. I believe this is a sleeping giant and the analysts/market have not priced it in. I'm laddering puts.
  - baskire 6y ago
    Wouldn’t it be more profitable to do calls on AMD?
    - smabie 6y ago
      Probably the better idea would be to be market neutral and long amd while shorting Intel.
gameswithgo 6y ago
market already knew this was coming
patrickthebold 6y ago
If you think it's high, you should short it.
- msbarnett 6y ago
  As the old saying goes, the problem with shorting is that the market can always remain irrational for longer than you can remain solvent.
  - smabie 6y ago
    The correct trade is long amd and short intel. That way, your position won't move against you unless Intel crushes amd
mrh0057 6y ago
Intel makes a lot more than x86 CPUs. I think there biggest competitor right now would be ARM. If more laptops and desktops start coming with ARM chips would hurt their market share more than AMD. Once that happens easier to develop for ARM processors in the cloud. Granted most software would just work unless you have x86 assembly in it.

And Intel's share price is.... still totally fine. Wait, WFT?

yakz 6y ago

AMD has produced a "better" CPU before, it didn't result in them taking over the market for CPUs.

kadoban 6y ago
Their market share is already rising. They're not going to "take over", there's too much inertia everywhere for that (and there's business and tech considerations beyond raw performance), but the main reason Intel's stock didn't take a hit is that this was expected.
x87678r 6y ago
Intel is fighting more than just AMD though. Apple ARM chips in MacBooks, Graviton processors in AWS, ARM Chromebooks and gaming computers/consoles just going pure Nvidia/Radeon - not a lot of room for Intel.
- vel0city 6y ago
  Intel historically hasn't been too big in the console gaming market, at least CPU-wise. Previous generations we've got players like IBM making the chips for the Xbox 360, PS3, and GameCube. AMD made the CPUs on the Xbox One and Playstation 4, along with the upcoming Xbox Series X and Playstation 5. The only somewhat modern game console I can recall with any Intel Inside was the original Xbox, with what was essentially a Pentium III Coppermine CPU. Other than that, they haven't really been a player in console gaming for nearly twenty years. They will really begin to feel the pinch from these latest Ryzen CPUs in the desktop gaming market. AMD had definitely been eating more and more of the value market, but Intel had still been holding the IPC/clock rate wins so it often had a little bit of an edge over AMD for those who don't mind to spend a little premium to get the highest framerates. This launch may make this no longer be true.
aloknnikhil 6y ago
Sure. But back then there was no "cloud" either. AWS alone is ramping up on AMD offerings. There's an AMD counterpart for almost every instance type today (suffixed by "a"). I think the world is a lot more ready to leverage multi-core and multi-threaded chips today than ever before.
- borland 6y ago
  We moved some of our AWS things over to "a" instances as they were cheaper per unit of performance than the intel ones. They've been great
- baskire 6y ago
  I see the server market skipping over and and moving to arm. The Apple silicon makes it easier for Silicon Valley Devs to use an arm ecosystem. That way dev/test/staging/prod is the same ish binaries.
cbozeman 6y ago
Yeah... and back then Intel was committing so many anti-trust violations that its a miracle the DOJ didn't litigate them into oblivion. Fortunately, they were paid up with the right people, apparently, and the DOJ was laser-focused on Microsoft.
TeeMassive 6y ago
Exactly. They are huge in the server / enterprise market. Good luck convincing your boomer boss switching to anything else than the overpriced "enterprise-grade hardware". And that's not even mentioning their compiler.
- luckman212 6y ago
  Please don't say "boomer" here. Can you make your point without resorting to ageism and bigotry?
- m463 6y ago
  "why is this gate here, let's rip it out!" I've worked a lot of places where there was consumer grade and enterprise grade. Sometimes the distinction was more on the marketing side of the scale sometimes less so. But the enterprise customers always got WAY better service. If you're running a business chaos is your enemy and it is costly.
- kmonsen 6y ago
  Lenovo just release enterprise workstation with threadrippers. Just ordered a few P620s for the team. They are compilation monsters.

dfdz 6y ago

Intel Revenue US$71.9B (2019) Intel Mkt cap US$226.98B AMD Revenue US$6.48B(2019) AMD Mkt cap US$101.57B (AMD stock is too high imo) Source: wikipedia and google search Edit: for 2020 AMD proj revenue growth 32% Intel proj revenue growth 4%

xur17 6y ago
How does revenue growth compare though?
TheBigSalad 6y ago
It sounds more like Intel's market cap is too low.
- jjoonathan 6y ago
  Revenue is backwards-looking, the expected value of future earnings is forwards-looking. Investors correctly expect a rough few years ahead. The worst is almost certainly yet to come, even if you're optimistic long-term.
jonplackett 6y ago
Exactly - look at growth. Intel is mostly just running on momentum. It will take a long time for them to slow down. but what if next year they still don't have their new shrunk node ready, and AMD, Apple and all ARM chips are on 5nm, 3nm... If that happens, intel will be forced to outsource their designs, probably to TSMC and at that point intel as we currently know it is gone.

owenmarshall 6y ago

The downside is priced in. Stock changes now are about expectations for future releases. The market has bet that Zen 3 will be good (short term) and Intel will regain ground over the long term.

deleted 6y ago
[deleted]
late2part 6y ago
I gently disagree. I believe this is a sleeping giant and the analysts/market have not priced it in. I'm laddering puts.
- baskire 6y ago
  Wouldn’t it be more profitable to do calls on AMD?
  - smabie 6y ago
    Probably the better idea would be to be market neutral and long amd while shorting Intel.

gameswithgo 6y ago

market already knew this was coming

patrickthebold 6y ago

If you think it's high, you should short it.

msbarnett 6y ago
As the old saying goes, the problem with shorting is that the market can always remain irrational for longer than you can remain solvent.
- smabie 6y ago
  The correct trade is long amd and short intel. That way, your position won't move against you unless Intel crushes amd

mrh0057 6y ago

Intel makes a lot more than x86 CPUs. I think there biggest competitor right now would be ARM. If more laptops and desktops start coming with ARM chips would hurt their market share more than AMD. Once that happens easier to develop for ARM processors in the cloud. Granted most software would just work unless you have x86 assembly in it.