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Technology Stocks : Intel Corporation (INTC)
INTC 43.48+8.6%Dec 2 3:59 PM EST
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To: Tony Viola who wrote (102599)4/19/2000 12:29:00 AM
From: Mani1  Read Replies (3) of 186894
 
Tony re << I understand AMD has significant quantities of Athlons in inventory>>

If you think there is bunch of Athlon's on the shelf waiting for buyers at AMD's warehouse you are WRONG!

Let me explain. Due to various manufacturing and inventory issue a semi manufacturer must have several weeks worth of supply in its channel. This is true for all manufacturers including Intel. Now if a product is ramping, like Athlon is, the unit supply (not days supply) in the channel MUST INCREASE so that the number of days for inventory turn does not decrease. So as long as AMD is ramping the Athlon it must manufacture more than it "sells" to keep up the number of supply days available in the inventory constant. This is a very simple concept and I am surprised why so many people are having problems with it.

The best I can tell, AMD has about 400K Athlon's in inventories throughout various channels. Considering that Athlon run rate is now about 600K per month, this corresponds to inventory of 20 days! 20 days is very lean, much less than the industry average, even at boom times like now. A small fluctuation in the supply channel and there is no CPU to supply to the OEM's.

So all this talk about AMD having Athlon's but no customer to sell them to is hog wash. It is just BS talk by people who have blind faith in Intel and who have failed to understand this very fundamental concept. It is so easy to stick your head in the sand, and pretend the only reason that Athlon, which clearly have superior FPU, is gaining market share is because demand is great.

Mani
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