Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: fastpathguru who wrote (260248)	5/15/2009 3:21:25 PM
From: JCB01	Read Replies (1) \| Respond to of 275872

Doesn't answer the question of why 160k? Why not more? profit = $X * 840K Pick your X and tell me you would reject it. I am assuming that basically they (the manufacturer) believe that they can only sell a given amount computers within the next two quarters or so, and beyond the cpu's will have aged to the point of not being desirable to have in the lineup. And they may have already have committed to Intel to buying their processors for the period in question. This could even be for innocuous reasons - such as you have to buy 5 million cpus or more within a six month period in order to be eligible for the discount schedule of a 5 million cpu purchase. Or, you may have even agreed to a purchase schedule with Intel to ensure deliveries will meet your timetable. Anyway, if you have to build up everything you purchase from AMD, you have to be able to sell it. At an additional 160 K units, you might be making a decent profit. To move an additional 1 M units, you might have to cut the price to the point where it isn't worth it - not just in material costs, but in warranty and support that you can expect to do for any computer. Anyway, a key part of my assumption is that the OEM in question didn't have enough incentive to pull part of an order from Intel and switch it to AMD even at 0 dollars.