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Technology Stocks : Advanced Micro Devices - Moderated (AMD)
AMD 233.54-1.8%Nov 7 9:30 AM EST
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To: THE WATSONYOUTH who wrote (219535)12/7/2006 9:51:27 PM
From: Elmer PhudRead Replies (1) of 275872
 
TWY

Are you going to tell me customers would prefer dual core P4s?

Did I say that? Read it again. It says P4 at the low end. It doesn't say dual core, and why make new product when you have inventory to dump? Who cares how much cheaper a smaller 65nm die may be to make when you have P4s sitting on the shelf and they'll fill the bill? What would you do? Scrap an existing die to make a cheaper one to sell at the same price? Everyone here talks about Intel's P4 inventory and you don't understand why Intel doesn't leave them on the shelf and make new equivalent ones just because they're cheaper. It's called inventory selloff. They're already paid for. They have no cost to produce. No new chip can ever be cheaper in it's place. That's what AMD will have to compete against at the low end until the inventory comes under control and then they will be facing newer 65nm lowend products.

So let's wrap this up because it's getting tiresome.

#1 Intel over built fab capacity because they underestimated AMD's market share gains.

#2 Intel overbuilt P4s because of #1.

They now have excess inventory and excess fab capacity because of #1 & #2.

No need to use yield as an explanation. It would have been the same either way.
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