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Politics : Formerly About Advanced Micro Devices
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To: Scumbria who wrote (46049)1/14/1999 6:42:00 PM
From: kash johal  Read Replies (2) of 1571200
 
Scumbria,

>Re: The conference call sounded quite candid, upbeat, and nothing >like it was initially portrayed. As an engineer, I found the >technical explanations quite palatable.

The problem here is not the facts:

Good volumes,
Increasing marketshare,
>400K of 400Mhz
K7 sampling this month
K-3 already in production

The problem is the way the company communicates with these ANALYSTS.
Last quarter they blindsided them with Good news. This quarter they were blindsided by "bad" news. Either way these Analysts are pissed off as they are made to look like idiots.

The company needs to build credibilty with these folks and should have changed it's guidance IMHO. The end result is that the stock is in tatters. If they had gotten the truth out earlier I bet the stock would be much higher than it is right now. The analysts would have much more faith in the numbers etc.

The problem here is AMD's IMHO. They don't know ho to manage expectations. In fact they would have been much more credible if their guidance for this quarter was sales etc would be lower this quarter. If they really look like shipping 5.5M in Q1 they could have had a release in end of february etc.

Now if they ship 4.5-5.0 M units they will miss again and get killed for missing the number. Same thing on increasing margins to 40% etc.

The folks who know how to play this game always set expectations low and then surprise on the up-side. And if they miss their internal expectations they still meet the number and everybody is happy.

regards,

kash
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