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

To: dougSF30 who wrote (147456)	1/11/2005 6:17:42 PM
From: Joe NYC	Respond to of 275872

Doug, I'm not sure it is fair to compare the two events. While both warned on flash revenue, in Q3 net income rose from Q2, while this time, operating (and surely net) income will be down. And of course, if you have bad results, I don't think it really matters when you announce them. In the end, it's the results themselves that matter. That is true, long run, but there is some Wall street protocol for these things. It seems improbable that AMD found out yesterday that flash would miss. Therefore, IMO, the time to announce was earlier or during the CC. AMD could have made the earnings announcement day yesterday. I guess now that the bad news on flash is out, AMD is going to try to talk about good news on CPG during the CC... Unless CPG results are also disappointing (hard to say for sure, although it appears ASPs were not up as much as I would've hoped, but let's say they are deemed "ok", overall), I see no reason to be overly conservative on CPG guidance. They've done pretty well there, so far. Intel is guiding revenues 5% down Q/Q, and that seems reasonable. It's flash that will be interesting. Will they divest it? What will he say if they don't intend to do that? How can provide credible flash guidance if they intend to press on with it? Agreed on all points. I think the point here is that AMD's business probably can't be predicted well in advance, especially in flash when the business is less than booming. So we end up talking about estimates and meeting estimates as opposed to actual results. The results themselves are nothing to write home about, that's for sure, but AMD is continuing to position itself for a takeoff (through continuing investments and taking on Boston design team), it is just that AMD seems to not be able to get on the next level of profitability. It is interesting to look back at those couple Macronix mentions in December, in light of the flash disaster. Any new thoughts? AMD must have known flash was in trouble at the point these articles were written, so what are they really up to? I am not sure what's up with that. I think that AMD saw the way to salvation through high density NOR flash, which is not happening. Maybe what AMD should do is completely change the pricing curve. As opposed to increasing prices as density goes up, maybe AMD should do the opposite, cut the price. Let's say if first 128 Mb is $10, make the next 128 Mb $5 (256 Mb = $15), next 2 128 Mb at $2.50 each (512 Mb = $20), next 4 at $1.25 (1 Gb = $25) whenever AMD is capable of making it. I don't really know what I am talking about here, and it is just a WAG, but this is something AMD needs to do to make ORNAND a factor. For a customer, the first 32 or 64Mb of NOR may be valuable, anything subsequent to that needs to be at priced of NAND for the chip to even be considered. Now I have no idea if this is even remotely possible. Just thinking outside the box (which is not at all difficult being totally outside the box as far as flash market is concerned). Joe