Joel:
After the market closes today, INTC will enlighten all of us with its view of the universe. My expectation is that the company will fight a rear guard action.
My expectation is that it will be forced to own up to deteriorating sales and revenues, but will no doubt express a belief in a "rebound" out there somewhere in the not-too-distant future (pick a number from the hat.... say Q1, 2003).
It would not surprise me to see the announcement of further "cost cutting measures", including additional lay-offs and reduced cap ex (hello AMAT, NVLS, etc).
In essence, what we will get later today will be a carefully staged attempt to once again bring down the expectations, but not so briskly as to traumatize or stampede the sheep cozily hanging out in the Intel pasture.
Reality of course is another thing. Intel and AMD are locked in one of the most vicious dog fights I have ever witnessed and unfortunately for Intel, AMD is currently positioned at Intel's six oclock, and is closing.
As I have noted for quite some time now, AMD is simply producing better micros and Intel remains in catch-up mode. Intel had hoped to torpedo AMD through predatory price reductions, but it didn't work out.
Worse for both players, the PC market is actually in shrink mode, hence they are squabbling over a shrinking pie.
I don't envy these two combatants, and I wouldn't own the stock of either one, (might even be inclined to short one of them), but I sure do know that Intel will be walking a fine line tonight between owning up to an increasingly nasty environment while not stampeding the dozing sheep.
Best, Earlie |
