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Politics : Formerly About Advanced Micro Devices

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To: Petz who wrote (103498)4/10/2000 10:22:00 PM
From: milan0  Read Replies (5) of 1570342
 
John

2. 1.2 million Athlon sales is below many people on this
board's expectations, if Jerry isn't sandbagging at least a
little. However, I said months ago, that you can't expect
AMD's market share in >$1,000 computers to grow more than
50% a quarter without more business SKU's.

I have to agree. My reasoning is based on a set of
assumptions that I believe realistic (but debatable):


1) The total x86 CPU market is divided 80% for business
systems and 20% for retail systems; also 38 million CPUs
were sold in Q1
x86 CPUs
Business 80% 30.4 M
Retail 20% 7.6 M
Total 38 M
* units in millions if % not indicated

2) The retail consumers buy mostly low end systems : 90%
Celeron and K6s vs only 10% Pentium III and Athlons. The
business market purchases as many high end systems (50%) as
low end systems. Subdividing the 30.4 M business systems
and the 7.6 M retail systems gives :

x86 CPUs Celeron & K6 Pentium & Athlon
Business 80% 30.4 M 50% 15.2 50% 15.2
Retail 20% 7.6 M 90% 6.8 10% 0.8
Total 38 M 22.0 16.0

From this, we could imply that total Pentium and Athlon
retail systems in Q1 amount to only 800K units. If your
strenght is in retail, it's pretty hard to sell millions of
high end systems (Athlons).

3) In Q1, AMD had only 5% of the business market but as much
as 60% of the retail market. Subdividing again the right
end part of the above table gives :

AMD K6 Athlon
5% 0.8 0.76
60% 4.1 0.46
4.9 1.22
* units in millions if % not indicated

For comparison purposes, I find the following for INTC sales
in Q1 :
INTC Celeron Pentium
95% 14.4 14.4
40% 2.7 0.3
17.2 14.7



My maths show that AMD could hardly sell more than 1.2 M
Athlons unless it had more than 5% business market share.
What does this imply if AMD is to sell 6 M Athlons in Q4?
Any comments?

Mike
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