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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Maverick who wrote (31178)	4/7/1998 1:33:00 PM
From: AK2004	Read Replies (4) \| Respond to of 1580104

Maverick, All - from MS/DW morning notes 10:02am EDT 7-Apr-98 Morgan Stanley\DW ......... NEW YORK MORNING MEETING SUMMARY/PART 1 ......... Company Update Advanced Micro Devices: 1Q Results May Pressure INTC/Help ALTR, LSCC, XLNX ........ Advanced Micro Devices will report its first-quarter earnings results after the market closes today. We expect investors to primarily focus on the company's K6 yields, but we believe the company's earnings results and near-term outlook will likely have investment implications for Altera (ALTR, $38, Strong Buy), Intel (INTC, $74, Outperform), Lattice Semiconductor (LSCC, $50, Strong Buy), and Xilinx (XLNX, $38, Strong Buy). We believe AMD's K6 yields improved significantly toward the end of the first quarter, and we believe the company's production volumes should increase sharply during the next two to three quarters. Although we believe AMD could move from being supply constrained in the first half of this year to demand constrained in the second half, we believe investor concerns over Intel's near-term margin and market share prospects will likely be a short-term negative for INTC. Following an 11% sequential decline in AMD's programmable logic (PLD) revenues in the fourth quarter, we believe strong demand in Europe and solid demand in the U.S. distribution channel led to a resumption of sequential revenue growth in the first quarter. We believe AMD's PLD revenues will grow in the second quarter as well, and with improving demand at AMD's PLD subsidiary (known as Vantis), we believe investors will become more optimistic about the near-term prospects for Altera, Lattice, and Xilinx.