Advanced Micro Devices - Moderated (AMD) Message Board

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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 208.32

+8.2%

3:59 PM EST

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To: eplace who wrote (9264)	9/19/2000 8:20:13 PM
From: Charles R	Read Replies (1) of 275872

Ed, <Charles, now that time has passed I will agree with you that the infrastructure situation wrt to AMD has not been what it could have been, > Still an understatement but I welcome the change in thinking. <but is it also possible that if AMD does indeed sell over 7 million chips this quarter and that at least half of those are Athlons (Thunderbird and Duron mix) that it may actually be a blessing in disguise? > I think the odds of AMD shipping over 7Mu this quarter are pretty slim. I am counting on about 6.8 and would be happy with anything close to 7 and ecstatic if it actually crosses 7 any significant amount. In any case, crossing 50% point in Q3 represents a rather slow ramp given Athlon was launched in Q2/Q3 1999. Not exactly what I would call a blessing in disguise. <Since AMD may be capacity constrained and assuming that they are selling just about everything they can make,> I have posted on this a few times including a post to someone (Petz?) on the other AMD thread a couple of days back. That AMD is capacity constrained is bunk. AMD at end of Q2 added a lot of inventory that I think is direct result of infrastructure problems. Note that with good fab planning this number can stay the same or go down in Q3. <doesn't it bode well for the company that they are then probably selling a proportionately greater amount of high margin chips?> Yes it does. The only point I make is that there is a huge opportunity being lost here. <I think the Duron and the infrastructure for it will take care of itself in time, but the margins on this chip aren't the greatest. Just asking for your take on this situation.> Duron margins are lower than Athlon but AMD needs to have a lot of volume on Duron to gain market share and to keep its fabs filled. I would have argued for something different if AMD had a lot of commercial design wins (which generate a lot of high end demand) and there is really a shortage of capacity. Fortunately for the longs, the shortage of capacity theory is still a realistic possibility for AMD IF AMD breaks in to the commercial space. Let's hope for some success there QUICKLY. Chuck

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