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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Paul Engel who wrote (139627)	7/18/2001 11:41:28 PM
From: Dan3	Read Replies (2) \| Respond to of 186894

Re: AMD's stock price today may look real good in a month or two ! Wait till you see what happens to Intel's stock price by the end of the quarter. Both Intel and AMD longs have a tendency to focus on their respective company's next quarter products and compare them to the current products of the other company. Intel is taking something of a gamble at this point: they need to be able to supply enough .13 Celerons and mobile PIIIs to let them use almost their entire .18 capacity to build 14 million P4s for Q3/Q4. Intel will be using its latest .13 copper capacity to produce 1.1GHZ Celerons that will compete with 1.1GHZ Aluminum Durons. AMD will be pleased to get $40 for those parts - which puts a pretty tight lid on what Intel can sell the output of its new FABs for. AMD's .18 mobile chips are MHZ competitive with Intel's new .13 chips, and AMD's more advanced power management technology makes up for much of the power savings advantage of Intel's .13 process. AMD's point to point bus and high IPC AthlonMP will put some pressure on Intel's server offerings for the first time, although that market is so dead for the rest of the year, that it doesn't much matter. Intel will gain back much of the ground it lost on the high end desktop because P4 has high nominal MHZ, but the confusing transition P4's platform is going through as the socket is changed and RDRAM fades away will be a problem for them. The lower power consumption of Palomino together with a mature platform offering a variety of integrated solutions will finally make AMD's product attractive in the corporate environment. The same factors that kept PIII a money maker for Intel last quarter will now favor Athlon in Q3 and especially Q4. P4's large die and extreme cooling requirements make it a difficult part to cram into a small form factor box. And difficult leads to a combination of expensive and let's use something else. The big surprise in Q4 may be AMD finally gaining a corporate presence at the same time it loses its aura of uniprocessor performance superiority (even a 1.5 Athlon4 is faster than a P4 2.2GHZ, but the market won't see it that way). The costs of running a FAB aren't limited to the direct costs of silicon, chemicals, and electricity - and Intel will have to run nearly twice as many wafers in Q4 as they did in Q2 to hold the same market share. They'll gain back a few million high end desktop ASPs but they'll convert 10 million mid-range ASPs to low end ASPs. The formerly high end mobile ASPs will become mid-range ASPs. And costs will be way, way up.