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

To: Petz who wrote (85236)	7/17/2002 7:33:50 PM
From: Dan3	Respond to of 275872

Re: I think AMD and the channel had a big inventory of Durons going into Q2. I agreee. Despite Elmer's relentless raving, it looks like AMD made almost enough parts in Q1 to satisfy demand for both Q1 and Q2. OTOH, if there is some thread of silver in that huge dark cloud, it's that they will be able to make enough Thoroughbreds this quarter to satisfy demand until the UMC Bartons start shipping. That would leave AMD, for once, able to dedicate a production FAB to a new chip/process (Hammer/SOI) without needing to make production runs of other parts, in the same facility, at the same time. I do think AMD is making a mistake by keeping ASPs as high as they have been. They'd be much better off selling more chips at a lower ASP. I'd love to see a 25% across the board price cut from AMD tomorrow morning. They can claim that, having just completed their transition to .13, their costs are down 25%, so they're dropping prices by 25%. Intel would have a tough time following suite. Intel had to give up on amortizing their goodwill, and is showing $200+ millon in revenue from selling shares to their employees, etc. while excluding $825 Million in costs for buying those shares (assuming an average price of $25 for the quarter). Note that, if you take their accounting statements at face value, Intel spent just over $1 Billion to buy 7 million shares of stock - that's $142 per share, which should give some indication of how much slop there is in that program to game their accounts. Bottom line: Intel is out of tricks to show earnings, and would have a tough time matching a big AMD price cut, right now. AMD needs to keep the volume up, to keep the chipset/motherboard infrastructure strong.