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Technology Stocks : Advanced Micro Devices - Moderated (AMD)
AMD 217.91+0.9%Dec 5 3:59 PM EST
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To: Ali Chen who wrote (75626)3/26/2002 11:40:33 PM
From: heatsinker2Read Replies (2) of 275872
 
Ali- I think AMD is making a big strategic mistake by taking a low-profile small-size path, with all this short-sighted "revenue per wafer". They will lose in the long run.

Two issues here. First, what is losing? I think you are implying that if AMD can't thump Intel on performance, then AMD (and us) are in trouble. But I would like to point out that we, at least most of us, are not primarily interested in AMD achieving the fastest CPU. What we want is the highest possible stock price. So we can win if AMD doesn't conquer Intel on the technical front. If AMD can just stay close over the next year, I am very hopeful that Wall Street will start valuing AMD with the same P/E as its peers in the semi industry. This would mean a big runup in stock price.

Secondly, AMD's current strategy is AMD's current strategy. Which means that they can change strategy whenever they want. Right now, they have a die size advantage and they don't really have the cash to build 300 mm fabs. So they are pursuing the strategy that makes sense today. There's nothing stopping AMD from moving to large-cache solutions in the future.

BTW, nice post. This is the 8th response. That's a lot for something that is actually on topic.
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