Advanced Micro Devices - Moderated (AMD) Message Board

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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 217.53

+1.5%

Nov 28 9:30 AM EST

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To: stribe30 who wrote (41735)	5/30/2001 6:34:36 PM
From: andreas_wonisch	Read Replies (3) of 275872

Scott & thread, Re: feel AMD is in the same situation with the server market.. acceptance may be slow initially.. it will have to be the smaller tier server guys who offer AMD as a product to get the ball rolling... if the benchmarks do well and the performance is stable.. .then larger OEMS will follow suit.. I don't buy it. AMD has be in a superior situation over Intel for almost two years. But what have they accomplished so far? Nine out of ten OEMs support AMD since January 2000 (when Gateway finally came aboard). But since then they have made almost no progress at all penetrating other sectors than the consumer space. There is still no top-tier OEM in the US selling AMD based PCs for business use. Even second or third tier OEMs are rare. There is only limited growth in the consumer market and I doubt AMD can grow there much further. Even if they had 100% of it, that would be only a fraction of all PCs sold. Do you really think things will get better in the future? Palomino desktop is slated for September. That another four months from now. At that time Intel will be at 2 GHz (in fact they will be there almost two months before desktop Palominos arrive) and will already preparing the Northwood launch for Q4. Why should the OEMs be tempted to switch to AMD based business systems then? They have the choice of going with a new design (P4) that can easily reach 2 GHz and above. Or they can chose a design that has a 30% MHz disadvantage and comes from an unproven brand in the business sector. And since Intel has already lowered price that much, the price difference doesn't cut it either -- what are 100 or 200 bucks if the whole systems cost ten times as much? Bottom line: I don't believe that things will get better for AMD. They had an enormous advantage in the past that they were too stupid to use. Now, this advantage slowly fades away and there's almost no hope for penetrating the business or server space. Add to that a price war with Intel (which hurts both companies enormously) and I don't think AMD is a good investment for now. With an estimated ESP of $1.50 that could easily be not met this year there isn't much upside for the stock. I think I'll wait until next Monday to decide what I do with the stock. But honestly I don't expect much. Yes, benchmarks will be very good and we all will be very excited over the AMD760MP. But that doesn't help AMD. They need top-tier OEMs. And they need them now. IMO AMD should try everything to accomplish that -- even if they have to sell parts at break-even for a short-time. Without them growth is limited and the stock will go nowhere from here. Just my two cents. Disclaimer: I still like AMD's technology. I just don't like their execution in the past 12 months. Same goes for Intel. But it's not that you have to own one stock or the other. Currently it's probably the wisest choice to not to own neither of the two. Andreas

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