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Politics : Formerly About Advanced Micro Devices
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To: Yousef who wrote (14716)5/30/1997 11:20:00 AM
From: Patient Engineer   of 1583495
 
Fab 25's capacity is not 5000 wafers per week as you state. AMD has said that by the end of 1998 the capacity will be 6250 per week. Today my guess is that AMD's capacity is maybe 1/3 of their eventual capacity. The reason it is so low is because they haven't fully equipped Fab 25 and K6's 5 layer process probably causes the backend of the fab to be a major bottleneck.

As has been discussed at length on this thread, there are not 200 die sites for K6 on a 200mm wafer. Theory would predict 145 and someone said they counted around this number of die sites on an actual wafer.

You are correct that a 50% yield would be great at this stage, but given the immaturity of the process, 25% yield would be a reasonable expectation.

This is the first quarter of ramp, so probably 50% of this quarter's theoretical capacity will be lost due to ramp up considerations. I wouldn't expect the first week of April to have the same output as the last week of June.

Taking these numbers you have:

2000 wafers/week * 13 weeks in the quarter * 145 gross die per wafer *
25% yield * .5 ramp up efficiency = 471,000 chips in the quarter.

This jives nicely with AMD's public statement of just two weeks ago that they are sold out for the quarter and will ship several hundred thousand chips.

Looking forward to Q3, an estimate might look like the following:

2500 wafers/week * 13 weeks in the quarter * 145 gross die per wafer * 30% yield = 1.4M chips.

In Q4 (huge level of speculation here):

3500 wafers/week * 13 weeks in the quarter * 145 gross die per wafer * 35% yield = 2.3M chips.

These numbers are all consistent with AMD's public statements. They are conservative, but not overly so, relative to common practice in the industry. They are also consistent with a stock price much higher than $40 or so per share.

In Q4, with an average selling price of $200 per chip (significantly lower than AMD's ASP today), Fab 25 generates $460M in revenue. This is almost equal to the total revenue AMD had in Q1 for the entire company. Incremental profits are at least $150M or $1 per share for the quarter. This gives AMD a PE of 10 and a growth rate of probably 100%.
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