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 : AMD:News, Press Releases and Information Only! -- Ignore unavailable to you. Want to Upgrade?

To: Brian Hutcheson who wrote (3646)	1/11/1998 2:07:00 AM
From: Kashish King	Read Replies (1) \| Respond to of 6843

This should be an ugly quarter for AMD, but how ugly? SAN FRANCISCO, Jan 9 (Reuters) - The financial turmoil in Asia and excess capacity have taken the shine off computer chip makers' normally robust fourth-quarter profits, and many companies have warned already of disappointing results... Analysts said Advanced Micro Devices, Intel's biggest rival in the PC microprocessor arena, would report a loss, because shipments of its K6 processor did not meet its target of two million units during the quarter and revenues from other products were flat. The company, which makes clones of Intel processors, faces pressures as Intel has been sharply cutting prices. AMD also is trying to switch to a new manufacturing technology... I suppose Sanders now gets a degree of respect for essentially announcing the loss weeks ago. The question is how ugly will it be and how much of that has already been priced in. I think we could easily drop below $12 depending on how thing play out in the broader market.

To: Brian Hutcheson who wrote (3646)	1/11/1998 12:21:00 PM
From: Kashish King	Read Replies (2) \| Respond to of 6843

This is also corroborated by the plentiful supplies of Acer , Compaq and IBM K6-233s in my neighbourhood and the rapid price drop since November. Brian, you haven't corroborated anything and your spin on the rapid price drops belies industry reports. We saw the same thing when Sanders was openly telling the trade press that there would be no profits: some chose to ignore that and in fact tried to deny that it ever happened. Brian, on the off chance that you actually believe your own interpretation of events (which I seriously doubt) here is anther informative press account: AMD Feels Bottom-Line Pressure (01/11/98; 10:50 a.m. EST) By Kelly Spang, Computer Reseller News As Advanced Micro Devices close their books for 1997, steep price drops, the growing strength of the sub-$1,000 PC, and the economic crisis in Asia will affect the chip makers' financial results. For Sunnyvale, Calif.-based AMD, Wall Street analysts are expecting manufacturing problems to drag down the company's bottom line, as well. "AMD is going to be tough. Their earnings are going to be low," said Jonathan Joseph, senior semiconductor analyst for Montgomery Securities of San Francisco. "They have manufacturing problems -- those don't just go away." As both chip makers prepare to announce their fourth quarter and year-end financial results after the market closes on Tuesday, Intel is expected to earn 90 cents per share while AMD is expected to take another loss for the quarter -- amounting to roughly 13 cents per share -- according to the First Call consensus. While AMD officials said the company will maintain its pledge into 1998 to undersell Intel by 25 percent for processor speed grades comparable to the K6, analysts are skeptical if that is possible. "When they first brought out [the K6] products it was possible [to undersell Intel by 25 percent]," said Brian Matas, vice president of market research for IC Insights, a market research company in Scottsdale, Ariz. "When AMD started suffering from yield problems, I don't think they can keep prices that low. They have to make some money." To date, the K6 has gone head to head with the Pentium with MMX, which Intel will phase out over the next year. But with the introduction of its 266-MHz K6, based on its .25-micron process technology, AMD will be forced to compete with the Pentium II on pricing. At the end of the month, the 266-MHz Pentium II will drop by 29 percent in price, and the processor will be priced at $289 by May. Analysts question if AMD tackled its manufacturing issues, which are keeping overall yields somewhere between 50 percent and 60 percent. A more acceptable level would be between 75 percent to 85 percent, Matas said.