Advanced Micro Devices - Moderated (AMD) Message Board

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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 214.99

0.0%

Dec 26 9:30 AM EST

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To: kash johal who wrote (47912)	7/16/2001 9:34:41 PM
From: Charles R	Read Replies (1) of 275872

Kash, <Flash $200M CPU: 4M durons at $40 each $160M 3.5M Athlons at $90 each $315M 0.5M A4 mobiles at $120 each $60M Misc $50M Total = $785M Breakeven at $830M Loss of $45M> I have a feeling that competition is going to be intense on the Athlon side and ASPs will drop disproportionately compared to Durons. The sense I got from the conf call was that AMD got shut of the spring refresh (and that's why we all saw AMD SKUs disappearing from retail April and May) but Jerry bought back the market share by going aggressively after back to school. If my hunch is right, we will see an explosion of Durons in the retail market over the next few weeks (reclaiming the old K6-2 market share). Intel cannot counter this with Celeron because of the MHz problem and Intel cannot counter it with P3 because that will kill Intel's ASPs (assuming P4 missed the back to school). Based on this, I would expect to see 4-4.5Mu Durons at about $50. Continuing with the above line of thought, Intel will try to make up for the Celeron share with aggressively priced P4s. I also think that Intel has several million Socket-420 (the old socket) P4s that they need to get rid of - to ensure that the socket 470 (the new socket) transition is clean. I see the old socket-420 P4s being discounted all the way down to $100. That will increase Intel units and reduce Athlon ASPs. I think it is possible that Athlons will be in the 3-3.5M range at an ASP of around $80. The only positive news is on the laptop side. The best I can tell there are still no good volumes on 1GHz PIIIs and 1/1.1GHz speed grades from Intel will not be plentiful until Tualatin mobiles ramp. And having Compaq/HP and especially Sony is going to be very positive for AMD. AMD may be able to sell 0.5-1M A4/Duron laptops at an ASP of $130+. The only major player that is missing in action right now is Toshiba. If Toshiba shows up early in the quarter then there could be further upside. Flash should come in at $200-$300M though probably closer to the $200M number. (I think it is possible that Jerry is sandbagging by forecasting another "up to $100M" decline in flash). I am hard pressed to see a dramatic changes in cost structure in one quarter so breakeven should be closer to $900 than $830. Bottom line: Right now, it is a crapshoot - too many variables. I would keep my eyes open for the breadth of back-to-school cycle and Brookdale ramp. Chuck

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