While AMD made a small profit last quarter, the Q4 outlook from the company is not nearly as rosy.  AMD estimates that Q4 revenues will be around 12% lower than Q3, making for a rare drop in what is typically a robust season for sales.  Unlike Intel, AMD is seeing a very soft PC market for their products.  Intel so far has been able to deliver parts that are as fast, if not faster than the latest APUs, but they also feature lower TDPs while at a comparable price.  The one area that AMD has a significant advantage is in terms of 3D performance and better driver support.

To keep the chips selling during this very important quarter, AMD is cutting the prices on their entire lineup of FM2+ parts.  This includes the entire Kaveri based lineup from the top end A10-7850K to the A6-7400K.  AMD is also cutting the prices on the previous Richland based parts, which include the A10-6800K.  Also of interest is that buyers of A10 APUs will be able to select one of three game titles (Murdered: Soul Suspect, Thief, or Sniper Elite 3) for free, or use the included code to purchase Corel’s Aftershot Pro 2 for only $5.

  A10-7850K A10-7800 A10-7700K A8-7600 A6-7400K
Compute Cores 12 (4+8) 12 (4+8) 10 (4+6) 10 (4+6) 6 (2+4)
Graphics R7 R7 R7 R7 R5
TDP (cTDP) 95 (65/45) 65 (45) 95 (65/45) 65 (45) 65 (45)
Suggested Price $143 $133 $123 $92 $58

The A10-7850K is a pretty good part overall, though of course it does suffer at the hands of Intel when it comes to pure CPU performance.  It still is a pretty quick part that competes well with Intel’s 2 core/4 thread chips.  3D performance from the integrated graphics is class leading, and the potential for using that unit for HSA applications is another checkmark for AMD.  We have yet to see widespread adoption of HSA, but we are seeing more and more software products coming out that support it.  Having tested it out myself, the GPU portion of the APU can be enabled when using a standalone GPU from either AMD or NVIDIA.  The Kaveri chips also support TrueAudio, which will show up in more titles throughout the next year.

One aspect of AMD’s latest FM2+ platform that cannot be ignored is the pretty robust selection of good and interesting motherboards that are offered at very low prices.  Products such as the Gigabyte G1.Sniper.A88X and the MSI A88X-G45 Gaming motherboards are well rounded products that typically sell in the $90 to $110 range.  Top end products like the Asus Crossblade Ranger are still quite affordable at around $160.  Budget offerings are still pretty decent and they come in the $50 range.

One other product that has sparked interest is the Athlon X4 860K Black Edition.  This product is clocked between 3.7 GHz and 4.0 GHz, features two Steamroller modules, and is priced at a very reasonable $90.  The downside is that there is no GPU portion enabled, while the upside is that there is potentially more thermal headroom for the CPU portion to be clocked higher than previous A10-7850K parts.  This will of course differ from individual chips, but the potential is there to have a pretty solid CPU for a very low price.  Add in the low motherboard prices, and this has the making of a nice budget enthusiast system.

So why the cuts now?  We can simply look at last week’s results for AMD’s previous quarter, as well as how the next quarter is stacking up.  While AMD made a small profit last quarter, predictions for Q4 look grim.  AMD is looking at around a 12% decrease in revenue, as stated above.  AMD has a choice in that they can keep ASPs higher, but risk shipping less product in the very important 4th quarter; or they can sacrifice ASPs and potentially ship a lot more product.  The end result of cutting the prices on their entire line of APUs will be of course lower ASPs, but a higher volume of parts being shipped and sold.  In terms of cash flow, it is likely more important to see parts flowing rather than having higher inventories with a higher ASP.  This also means that more APUs being sold will mean more motherboards from their partners moving through the channel.

Intel does have several huge advantages over AMD in that they have a very solid 22 nm process, a huge workforce that can hand tune their processors, and enough marketing money to make any company other than Apple squirm.  AMD is at the mercy of the pure-play foundries in terms of process node tweaks and shrinks.  AMD spent a long time at 32 nm PD-SOI before it was able to migrated to 28 nm HKMG.  It looks to be 2015 before AMD sees anything below 28 nm for their desktop APUs, but it could be sooner for their smaller APUs and ARM based products on planar 20 nm HKMG processes.  We don’t know a all of the specifics of the upcoming 16/14nm FinFET products from TSMC, Samsung, and GLOBALFOUNDRIES, so it will be hard to compare/contrast to Intel’s 2nd generation 14 nm TriGate line.  All we know is that it will most assuredly be better than the current 28 nm HKMG that AMD is stuck at.