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.

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

To: Joey Smith who wrote (44553)	1/1/1999 5:57:00 PM
From: Cirruslvr	Respond to of 1585576

AMD in 1999 - A little baseball analogy here. For this to be a very good year, AMD will have to hit for the cycle. Single New Tier 1 OEM - AMD will be racking up sales with this Double Timely release of the K6-3 - ASPs will be benefited most with this Homerun (the most exciting one) Release of K7 - It will be a shot heard around the world Triple (the hardest one to attain) Successful start-up of Dresden AND smooth transition to the .18 process in Austin.

To: Joey Smith who wrote (44553)	1/1/1999 7:29:00 PM
From: Maxwell	Read Replies (3) \| Respond to of 1585576

Joey Smith: <<You obviously don't have a clue about Intel's business model. Hint: a few weeks ago, Intel said margins going up (not down) and many analysts are saying Intel ASPs are actually rising a bit. Intel has the luxury of many market segments, unlike AMD.>> Are you stupid or what? Where do you think Intel margins are coming from? It ain't from the dropping price in PII and it ain't the $75 CeleronA. It is the Xeon that is carrying the WATER! Intel is ramping the Xeon and that is what saving the margins. It won't be long till the K7 comes out. I can guarantee you that the K7 will be faster than any Xeons Intel got. <<One thing is certain, though. AMD has been forced to slash their top-of-the-line chip prices, and this will go straight to their bottom-line. I can't wait to see Jerry squirm his way out of this one in a couple of days!!!>> A few quarters back AMD margins are in the 20s percentile when the CPU revenue was only 10%-20% of AMD total revenue. Last quarter AMD's margin was 38% and the CPU was 55% of the total revenue. Into Q4 and 1999 AMD expects margin in the 40s percentile. So where do you think the increase in margin comes from? It ain't the flash, the communication, or PLD. If you read the SEC reports in Q3 AMD CPU was $380M of 3.8M K6-2 (55% of total sales) and ASP=$100 and margin was 38%. In Q4 AMD expects to sale 4.8M-5.7M CPU according to analysts which will be about 65% of total revenue. That my friend will translate to higher margin since CPU is AMD highest margin. I tell you even if AMD sells K6-2-400MHz for $100 they will make about $60/chip. The guy with the smaller die wins. You obviously have no idea how this industry works. Maxwell