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

To: DRBES who wrote (196801)	5/15/2006 12:50:27 PM
From: bobs10	Read Replies (1) \| Respond to of 275872

you... sounds about right me... I know I've said it before, but I'm much more concerned with Bob's profitability than I am with INTC's or AMD's. To that end I'm much more concerned with AMD's gross margins than I am with anything else. Over the last 8 years there have been both ups and downs, but in general AMD has clearly out executed INTC. One has to look no further than a graph of INTC's and AMD's price performance over the last 5 years to see the proof of that statement. Currently we have a situation where AMD is saying that GMs will remain in the 55% to 60% range, while INTC is saying that GMs could drop below 50% for the first time in a very long time. If that isn't an example of how things have changed I don't know what is. Again, personally I expect INTC's margins to fall more as it struggles to compete with AMD. As I see it AMD is currently taking gobs of market share from INTC each quarter which is leading to a sort of panic at INTC. If recent history says anything it's that so far INTC has been notably unsuccessful in coming up with any sort of response to AMD on almost any level. To think that that situation is going to reverse anytime soon, given the history lessons of the last 8 years, begs the imagination. INTC still has far too many problems for them to turn things around. While the hobgoblins of "price war" and "NGA" continue to haunt AMD and will probably for the rest of the year, anyone expecting INTC to turn around is living in WBMW's world. AMD has spotted INTC a very large lead, but if it retains its' current margins while taking even a little more share than "market growth" the company is going to be very profitable. At the same time INTC has all those fabs to fill and a very uncompetitive cost structure to deal with.