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To: Barry Grossman who wrote (65871)	10/6/1998 1:23:00 PM
From: John Koligman	Read Replies (2) \| Respond to of 186894

Sony to go with AMD in Japan.... Sony deal boosts AMD By Michael Kanellos Staff Writer, CNET News.com October 6, 1998, 9:15 a.m. PT Sony has adopted the K6-2 processor from Advanced Micro Devices for a new line of consumer PCs for the Japanese market, a design win on the eve of the company's quarterly report that could presage AMD-based Sony machines in the U.S. The Sony deal will likely be one of the topics in what is expected to be a relatively upbeat conference call today. AMD is still expected to post a loss, but a much smaller one than AMD reported in previous quarters and even predictions from a few weeks ago. The consensus estimate is now a loss of 12 cents a share, up from predictions of a loss of 14 cents a week ago. Some even believe the loss could be narrower. "We're looking for a loss of 5 cents a share based on microprocessor demand," said Mark Edelstone, semiconductor analyst with Morgan Stanley Dean Witter. A small profit is also a possibility. Edelstone estimated that AMD shipped 4 million K6-2 processors in the quarter, a volume that would surpass AMD's goal of shipping 3.2 to 3.7 million for the quarter. Sony will incorporate the 350-MHz K6-2 in its new line of "Vaio Compo" PCs to be released on October 31, the company said. The Vaio Compo computers are essentially budget-conscious PCs with enhanced audio capabilities. Equipped with 64MB of memory and a 6.4GB hard drive, the Compos come with a high quality sound generation chip for recording from or to CD-ROMs, the company said. Sony announced the PCs at PC Expo in Japan. For AMD, the deal with Sony is the latest in a series of design wins for the processor vendor in 1998. Last year, manufacturing problems with the K6 led to financial losses and prevented the company from cutting deals with major PC vendors. Earlier this year, the company was able to iron out most of the manufacturing problems and produce chips in greater volumes. Greater supplies, combined with relatively low prices, have in turn lead to design wins and market share gains. This year, Compaq, IBM, and Hewlett-Packard have adopted versions of the chip for consumer PCs. AMD-based computers accounted for three of the top six selling computers in retail outlets for the month of September. AMD is still expected to post today a loss for the third quarter, its fifth quarter loss in a row. Nonetheless, analysts say that the losses are narrowing. Additionally, market share also continues to climb, according to most estimates. Sony has not stated any plans to release the Vaio Compo in the U.S., but sources close to Sony said that the company is considering adopting the K6-2 for the U.S. market. Related news stories