Advanced Micro Plans to Gain Market Share From Intel (Update2)
2006-06-06 08:00 (New York)

     (Adds comment from Intel in 13th paragraph.)

By Young-Sam Cho and Tim Culpan
     June 6 (Bloomberg) -- Advanced Micro Devices Inc., Intel
Corp.'s largest competitor in computer chips, forecast it will
extend market-share gains this year, helped by demand from
corporate customers.
     The company will probably raise its share of processors that
go into desktop computers by a couple of percentage points to the
``mid-20s'' by the end of the year, President Dirk Meyer said in
an interview today in Taipei. The Sunnyvale, California-based
chipmaker also expects to gain share for the devices that go into
laptops and servers, he said.
     ``There's a lot of requests from consumers for AMD,'' K.Y.
Lee, chairman of Benq Corp., a Taiwanese notebook maker, said in
an interview yesterday. ``Performance-driven customers prefer the
AMD chips.''
     Advanced Micro, which gained market share by introducing
chips quicker than its bigger rival, last month won its first
contract with Dell Inc., ending a 22-year exclusive relationship
with Intel. To regain share in the $35 billion semiconductor
industry, Intel is countering with faster processor chips
starting this month.
     Benq, based in Taipei, is increasing orders of Advanced
Micro chips, Lee said. The company still buys most of its
processors, the main chips that interpret and execute
instructions in a computer, from Intel, he said.

                       Highest Market Share

     Advanced Micro's market share for servers rose above 20
percent for the first time in more than four years in the past
quarter, according to Mercury Research.
     ``Customers are starting to see the benefits of competition
in their supply base,'' said Meyer, who's in Taiwan for the
Computex trade show this week. ``There's a very mistaken view
that the share gains that we have made recently are purely as a
result of product performance leadership.''
     Demand from emerging markets such as China and orders from
corporate customers will probably drive Advanced Micro's sales
growth, he said. He stuck to forecasts that the company plans to
increase its share of processors that go into server computers to
30 percent by the end of the year and declined to specify market
share targets for notebook computers.

                         New Chip Designs

     Intel has responded to Advanced Micro's gains in market
share by pledging to introduce a new fundamental chip design
every two years.
     Anand Chandrasekher, Intel's sales chief, said today the
company will probably regain market share this year after it
begins selling its faster types of processor chips starting this
month. The Intel senior vice president, who spoke at a press
conference in Taiwan, declined to specify a figure.
     The Santa Clara, California-based company is introducing the
Woodcrest chip for computer servers this month; the Conroe chip
for desktops next month and the Merom semiconductor in August.
     ``I'm not worried,'' Chandrasekher said. ``In 2006, we got a
barrage of new products.''

--Editor: S. James (tcw)

Story illustration: See {INTC US <Equity> ANR <GO>} for a chart
of analysts' recommendations on Intel. To chart Intel's earnings
against estimates, see {INTC US <Equity> SURP <GO>}.
To chart Intel's share price, see {INTC US <Equity> GP <GO>}.
To chart AMD's share price, see {AMD US <Equity> GP <GO>}.
See {TTOP <GO>} for the day's top technology-related news. Click
{NI SHOW <GO>} to read more stories from conferences.

To contact the reporters on this story:
Young-Sam Cho in Taipei at (886) (2) 7719-1542 or
ycho2@bloomberg.net
Tim Culpan in Taipei at (886) (2) 7719-1541 or
tculpan1@bloomberg.net

To contact the editor responsible for this story:
Teo Chian Wei at (886) (2) 7719-1536 or
cwteo@bloomberg.net

[TAGINFO]
INTC US <Equity> CN
AMD US <Equity> CN
DELL US <Equity> CN
2352 TT <Equity> CN

NI US
NI COS
NI CA
NI ELE
NI SEM
NI CPR
NI EM
NI ASIA
NI ASIAX
NI JAPAN
NI SHOW
NI TWN
NI TEC
NI CEO
NI WIN

#<104519.177670.2005-11-10T14:40:00.25>#
-0- Jun/06/2006 12:00 GMT