X-bit Labs reports financial analysts have mixed feelings about AMD's plan to integrate ARM cores into its server processors. Wall Street analysts agree that the ARM architecture can help the Opteron line to achieve better performance per Watt, but the concern is that this product won't hit the market until 2014 and the micro-server market will be pretty crowded by then. On top of that, analysts also point out that struggling AMD needs a saviour in the short term, otherwise it's uncertain whether the company will be able to roll out these hybrid x86/ARM Opterons.
But the main problem for AMD and its ARM server chips endeavor is not competition or uncertainties with the micro-server market in general. The main concern is whether AMD can survive before it rolls-out Opteron processors with ARM architecture. Ironically, we do know what AMD readies for launch sometimes in 2014, but we do not know what the company is getting ready to release next year.
“We do not expect to see any products coming out of this new partnership with ARM for at least 18 months, and management readily admitted that this would be a 3-5 year process. Given the state of their core business, however, we are not sure they have that much time – we forecast significant cash burn and balance sheet deterioration through much of the next five quarters,” wrote Stacy Rasgon, an analyst with Bernstein Research.