Hi PB:
I'll try one more time...
AMD has ushered in the year 2000 with the "spry Athy", the WORLD'S FASTEST MICROPROCESSOR, which is available in quantity at the retail level...
Intel, despite assuring OEM's of ample supply of PWeeIII 733's and 800's beginning back in October '99, over 4 months ago (for 733's and 2 months for 800's) has yet to meet its promise...
Highly unusal behaviour for Intel which implies to most observers that the PWeeIII is worn and fatigued and unable to compete with the new champion, the Athlon...
Whereas the "spry Athy" has demonstrated repeatedly not only superior performance but also ease in production in moving up the MHz gradient scale from 500 to 800 without any significant hitches (not to mention the rumoured 1 gig's just sitting waiting for Intel to get their head out of their -ss), and whereas the PWeeIII seems stopped out at 733 as far as meaningful quantities of production are concerned, it does follow for me, and an increasing number of observers, that the "spry Athy" will prove to be a major success in Y2000 and AMD will ship a minimum of 10 million "spry Athys" in Y2000...
Without any meaningful competition in the top end, as Intel who held such a position 1 year ago is well aware, margins can be fairly fat, and now that the Athlon is the market's superior microprocessor, AMD will in Y2000 reap some fat margins, which could easily drive their ASP well past $1.00 and drive eps well past Intel's $3.00 (?)street estimate for Y2000.
It does not make sense to me that if AMD's eps in Y2000 exceeds Intel's eps that the current ratio of $100 for Intel and $36 for AMd will stand up. Iwould expect this ratio to narrow significantly...
Comment (1): You really shouldn't get your nose out of joint because Intel is havind severe problems in delivering product at the top end...There is lots of room for Intel in the mid and low end segments and lots of room to gain a return in those segments not to mention their investments to offset the very significant costs incurred in attempting to compete with the "spry Athy" in the top end.
Comment (2): As AMD is now competitive in the top end for the first time in their history, their margins will expand dramatically throughout Y2000. As Intel is no longer top dawg in the top end and as Intel is incurring significant cost in attempting to remain competitive in the top end and as Intel is currently suffering opportunity costs associated with their inability to supply significant quantities in the top end, then I would expect Intel's margins in the top end to narrow significantly in Y2000.
Comment (3): AMD's ASPs are destined to grow at a much faster pace than are Intel's in Y2000. Consequently AMD's ROI on $36 will prove to be superior, possibly by a wide margin, to Intel's ROI on $100, imho.
Comment (4): Your suggestion that Intel is not experiencing grave difficulties in meeting any meaningful production schedule in the top end, I hate to say, is balderdash...and as such you might reasses your conclusion about just who is speaking out of which side of their mouth! |
