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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: Bill Jackson who wrote (57308)	10/5/2001 11:33:48 AM
From: wanna_bmw	Read Replies (1) \| Respond to of 275872

Bill, Re: "AMD server CPU sales at less than 5% it must be laptops and SD shops that bring up the average, it sure is not Dell" I have an explanation for you. It may not be the right one, but at least the numbers add up. Consider what happens when major OEMs begin dropping their share of AMD models. Where does AMD go afterward, assuming they nearly maintain market share? My answer is the channel and the retail market. AMD's presence is still large in the retail market. Best Buy is certainly a large U.S. chain, and by simple observation, they have about 50% AMD skus. On the other hand, I've also casually seen both Comp USA and Frys, and they are both around 90% Intel. So I would estimate AMD retail market share at about 35%. Their channel market share is also excessively large. All your screwdriver shops, as well as the tier 3/4 OEMs from pricewatch.com seem to be buying a lot of AMD volumes. I would estimate AMD's share here at about 40% or higher. Now, if you consider small businesses looking for cheap UP/DP front ends, you might find AMD has gained a lot in this segment. One market research report showed that they had a 35% presence in small businesses. I don't know if that has changed, but that would be even larger than my guess. Consider government and education, which have also been shared on this thread as having a decent AMD presence. I don't remember what the percentages were, but I was surprised at the numbers (I think above 20% in both cases, but below 30%). Finally, there are the large, tier-1 OEMs. I think realistically, most of the PC market's sales comes from IBM, Dell, Compaq, HP, and Gateway. Discounting retail sales, which we have already covered, I would consider AMD's presence here to be well under 10%. And this is only counting the volumes that HP and Compaq must be selling, since IBM, Dell, and Gateway are now 100% Intel. Given AMD's small market share in top tier OEMs, I think that is what is weighing down the average. Either way, AMD's share of the market is smaller than you think. If you are considering the channel or retail, then I can see why you thought AMD's share was much higher. However, you should not ignore the relatively large portion of the market covered by the top tier OEMs. wanna_bmw