Could be good for CPQ
Intel seen on war path
Shares of Intel Corp. (INTC: news, chart, profile) were down 20 cents from the New York close at $31.48 in Germany. Shares were offered lower on Instinet.
Shares of AMD (AMD: news, chart, profile) were down 10 cents to $19.15, according to market makers at Madoff Securities.
Lehman Brothers told clients overnight that Intel is planning to drop a "price bomb" on Aug. 26 in an effort to take back market share from rival AMD.
The leading chipmaker is planning to cut prices by 50 percent on high-end PIVs and will try to move the processor market above AMD's highest megahertz offering, analyst Daniel Niles said. He expects the price for the high-end PIV 1.8 GHz to drop to $260 from $562, and that the low end will be cut as well.
"For those who thought the price war was already aggressive, you haven't seen anything yet," Niles said. AMD has increased its share against Intel from 13 percent to 21 percent over the past two years, Lehman said.
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