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

To: Dan3 who wrote (144816)	10/6/2001 3:35:52 PM
From: Monica Detwiler	Read Replies (1) \| Respond to of 186894

As Loss Widens, Chip Maker AMD Blames Price War With Intel By CHRIS GAITHER The New York Times Advanced Micro Devices said a price war with the Intel Corporation (INTC - news) had driven down third-quarter revenue and widened its net loss to as much as $220 million. SAN FRANCISCO, Oct. 5 Advanced Micro Devices said today that a price war with its chief rival, the Intel Corporation, had driven down third-quarter revenue by 22 percent from the second quarter and widened its net loss to as much as $220 million. For the quarter ended Sept. 30, Advanced Micro said shipments of personal computer chips remained at the same level as the second quarter, when the company sold 7.7 million of its Athlon and Duron microprocessors. Sales of flash memory, used in devices like cellphones, declined about $100 million from $316 million in the previous quarter, as expected. In spite of the steady unit sales, Advanced Micro said preliminary financial results showed that revenue fell to $766 million, a decline of 22 percent from the second quarter and 37 percent from the period last year, when sales were $1.2 billion. Advanced Micro had predicted that its sales would fall 15 percent, compared with the second quarter. As a result, the company said it expected to report a net loss, excluding special items, of $90 million to $110 million, or 26 to 31 cents a share. The figures do not include one-time charges of $80 million to $110 million related to two plant closings and job cuts that Advanced Micro announced last month. Advanced Micro, which is based in Sunnyvale, Calif., followed several other technology companies in warning Wall Street this week about a difficult quarter. But unlike the others, the chip maker did not blame the Sept. 11 terrorist attacks. Instead, it faulted Intel for driving down prices. "In an effort to make up for the performance deficiencies of computers based on its Pentium 4 processors, Intel resorted to aggressive pricing and large, cash-backed marketing programs," W. J. Sanders III, Advanced Micro's chairman and chief executive, said in a statement. A spokesman for Intel declined to comment on Advanced Micro's charges but said Intel sells the fastest microprocessors on the market a claim that Advanced Micro disputes. Dan K. Scovel, a semiconductor analyst with Needham & Company, said Advanced Micro's ability to sell as many chips as it did in the previous quarter suggested that its Athlon processors could compete well in the coming months. But Mr. Scovel predicted that Advanced Micro would not turn a profit again until the last quarter of 2002, which could cut into research financing for new products. "As long as Intel keeps them under the gun and denies them from making money, it prohibits A.M.D. from investing money for the next generation," he said. Shares of Advanced Micro lost 40 cents, or 4.4 percent, to close at $8.60. Intel stock rose 41 cents, to $21.96. Email this story - View most popular \| Printer-friendly format