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

To: Petz who wrote (239092)	8/20/2007 6:50:28 PM
From: dougSF30	Respond to of 275872

Actually I'm more interested in the answer to the following question: That's a coffee house board question. And you know this, how? All the facts are in the Intel CC. seekingalpha.com Well, I will do the best I can. Why don't I start with a high level explanation of gross margin Q2 to Q3, and then we can talk a little bit about the pricing environment. If you look at the improvement of 5 points, it comes from a variety of places. We do expect unit volumes to be up. We also expect average selling prices to be down a little bit, and we expect unit costs to be down. If you take all three of those categories and say those are kind of microprocessor operating items, you get almost 3 points of good news of gross margin quarter to quarter. The fact that you don't have the start-up costs, obviously you don't have as much in start-up costs in the third quarter versus second quarter, there is almost 2 points of good news in margin. You also have an extra point of what I will call miscellaneous items. For example, because we're selling the NOR flash business depreciation got suspended, so there is no depreciation in the third quarter. It makes margins a little better. An extra point of a lot of little things like that. The negative offset is as you begin to build the 45-nanometer product that's not yet qualified for sale, you can't put those costs in inventory, so we will have a bit of a drag on the build of product that isn't qualified for revenue until the fourth quarter. That's 1 to 2 points negative. Now, as far as the pricing environment. It was a more competitive pricing environment than we thought in Q2, and we expect it to continue to be somewhat competitive which is what you're seeing in our margin outlook for the year. We believe the best defense against the competitive price environment is better product. If you look at what's happening with us the last year, you've seen better products quarter by quarter by quarter. You've seen improved product differentiation, 45 nanometer coming out; the Penryn product family, as Paul talked about. So what you're seeing is Intel's commitment and focus to making our products better and better and better which is the best defense we have in a competitive pricing situation.

To: Petz who wrote (239092)	8/21/2007 12:06:33 AM
From: wbmw	Read Replies (2) \| Respond to of 275872

Re: re: About 3-4 percentage points comes from the 45nm ramp >> And you know this, how? Because I bothered to listen in on the earnings conference. You can, too (by the way, it looks like I got the numbers flipped, it is 2% for the end of 45nm start-up costs, and 3% for other items). "If you look at the improvement of 5 points, it comes from a variety of places. We do expect unit volumes to be up. We also expect average selling prices to be down a little bit, and we expect unit costs to be down. If you take all three of those categories and say those are kind of microprocessor operating items, you get almost 3 points of good news of gross margin quarter to quarter. The fact that you don't have the start-up costs, obviously you don't have as much in start-up costs in the third quarter versus second quarter, there is almost 2 points of good news in margin." seekingalpha.com Re: Actually I'm more interested in the answer to the following question: Why did Intel suddenly decide that its OK for Intel employees to post on SI again, after banning that for a few years? Did Paul Engel die or something? For a long time, Petz, I've wondered if you are an AMD employee. You've tried to deny it, but you certainly have the most steadfast faith in AMD of anyone else, not to mention the guile to start witch hunts for the so-called Intel employees on this forum. In my experience, it's usually the person with the guiltiest conscience who tends to throw the first stone. Think about it, Petz. Perhaps it's better for your employer if you shut your mouth before you start exposing things about yourself that you'd rather keep hidden.