AMD, Symmetry Sign Agreement - Analyst Blog
December 05 2012 - 2:50AM
Zacks
Advanced Micro Devices
Inc. (AMD) signed a global distribution agreement with
Symmetry Electronics, a distribution leader in the embedded market.
According to the agreement, Symmetry Electronics will promote, sell
and support the full range of AMD embedded products, including the
new entrant AMD Embedded R-Series accelerated processing units
(APUs).
Founded in 1998, Symmetry
Electronics is an ISO 9001:2000 certified company. Headquartered in
California, it specializes in distribution, value added services to
semiconductors, and embedded modules (particularly wireless and
video products). The company is now focusing on wireless,
video-audio, memory-storage and power products.
The new agreement with Symmetry
Electronics should open up new markets for AMD’s embedded APUs and
graphics processors and also boost its customer base. Both the
companies are trying to provide high-performance products that
consume lower power and support embedded life cycles.
Moreover, Symmetry Electronics’
leadership in distributing embedded products will provide the
requisite strength in marketing and distribution of AMD’s newest
line of Embedded G-Series and R-Series APUs.
The embedded system processors are
quite a lucrative market. AMD’s G-Series APUs compete against
products from Intel Corp. (INTC) and Mips
Technologies Inc. (MIPS). Its G-Series APUs are used in
various formats such as set-top boxes, gaming systems, information
kiosks and point-of-sale systems among others. Thus, AMD has been
gaining a strong presence in the embedded market.
Over the past decade, AMD has been
active in acquiring companies that could strengthen its position in
embedded markets. In 2002, AMD acquired Alchemy Semiconductor for
its Alchemy line of MIPS processors. Again in 2003, it purchased
the Geode business from National Semiconductor to strengthen its
existing line of embedded x86 processor products.
We are positive about AMD’s
endeavor to deliver innovative products and technologies to its
customers. However, Intel is a very strong competitor with
significant resources and technological prowess. AMD on the other
hand is struggling to hold its own. It is even attempting a sale
and lease back of its property to unlock much-needed cash.
AMD’s revenues in the third quarter
came in at $1.27 billion, down 10.2% sequentially and 24.9% year
over year, more or less in line with its revised guidance of a 10%
sequential decline (at the mid-point). Revenues were also in line
with consensus expectations of $1.28 billion. The Graphics business
generated 27% of its sales and was down 6.8% sequentially and 15.1%
from the year-ago quarter.
AMD’s shares carry a Zacks Rank #5
(Strong Sell). Intel and Mips both carry a Zacks Rank #3
(Hold).
ADV MICRO DEV (AMD): Free Stock Analysis Report
INTEL CORP (INTC): Free Stock Analysis Report
MIPS TECH INC (MIPS): Free Stock Analysis Report
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