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

To: Petz who wrote (140059)	11/13/2004 10:57:31 PM
From: gzubeck	Respond to of 275872

Petz, I would absolutely say your right over the next four quarters given AMD's limited manufacturing capacity...after FAB 36 I would say all bets are off...;>)

To: Petz who wrote (140059)	11/14/2004 6:01:46 AM
From: TGPTNDR	Respond to of 275872

John, Re: <So, to get to 50% market share...> The math looks right but you're answering a question that wasn't posed. This gets more than a little windy, so here's the short answer. REALLY CHEAP CHIPS. New market. I think the chances that AMD will have X-86 volumes in excess of 40M/Q in 2006 are better'n 50% was the statement. 40M/Q would be nearly 80% of Q404 production, if I've got the numbers right, but that's current mainstream computers/die. But that wasn't the question either. I'm guessing that the X86 market may be coming to a drastic expansion in terms of die in service as X86 embedded joins with massively parallel. As far as the time frame goes, '06, that's also just a guess. Next question: I don't think its possible for AMD to increase its market share by more than 10% per quarter, no matter how good its products are. That's a Marketing question as well as a production question and you could be right. Last Q I think AMD came in at about 16% of X86 market(Mercury said 15.8%, including X-box, IIRC.) while SELLING ~7.2M CPUs. That'd make it a 45M CPU quarter, something less than published numbers, IIRC. No facts, just supposition.(I'd have used published figures but didn't find them.) I think you'd agree that this Q sales will be up 10% or more over Q3. Call it 52-55M. So this Q AMD's going to have to peddle something north of 8.2M just to stay even in unit market share. Doesn't look like a problem to me. They might peddle as many as 9M, but I think that'd be stretching it. But then, can AMD hold units while market drops in 1Q '05? Clearly not if Intel goes to "Scorched earth pricing". I don't think Intel will do that. I don't think Intel can do that at EITHER $ end of the desktop market(high end or low end), or the server market. (As somebody from Intel said, there just isn't much elasticity in the market.) So, if AMD can hold sales flat in Q1 and market drops to 45M that's something north of 18%. Not including new products. But there's the rub. New products. Will the REALLY CHEAP CHIPS sell in volume? Can Intel come up with an answer to that problem? How much market share is there for REALLY CHEAP CHIPS? Can AMD do 1M REALLY CHEAP CHIPS in Q1'05 and maintain a 100% ramp rate? That'd put 8M REALLY CHEAP CHIPS out there in Q4'05, 16M in Q1 '06, etc... I don't know the answer but I suspect they can, at least for a while, and that's where the 50% probability of a 40M Q4 '06 statement came from. -tgp