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Technology Stocks : Advanced Micro Devices - Moderated (AMD)
AMD 231.83+1.7%Jan 16 9:30 AM EST
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To: Elmer Phud who wrote (147590)1/12/2005 9:28:44 PM
From: PetzRead Replies (2) of 275872
 
BTW, something I never noticed before is that Intel's Centrino wireless chips are considered to be part of the ICG (Communications) group rather than IAG (microprocessors) group. That's important because it's extremely unlikely that Intel doesn't make big profits off of selling 10M wireless chips a quarter at prices above what the competition sells them.

Another note is that this non-Flash Comm subdivision, which includes wireless chips in its portfolio, grew 5% quarter over quarter, while Flash revenues grew less than 1%.

The loss in the ICG group narrowed from $250M to $196M, but this is illusory. The reason is that the unallocated loss of the "Other" group increased by $222M in the quarter. Surely some of these unallocated costs should be allocated to ICG, which is about 15% of Intel's revenues, and probably a larger proportion of Intel's personnel. The burgeoning revenue from wireless chips combined with comments about increasing Flash units vs. flat Flash revenues makes it very unlikely that it was the Flash Subgroup's profitability that improved in Q4.

But lower Flash prices obviously hurt AMD more than Intel, so it was obviously a good strategy to cause more pain at your rival than you cause to yourself.

Petz
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