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

To: Gary Ng who wrote (53034)	3/21/1999 3:45:00 AM
From: Mani1	Read Replies (3) \| Respond to of 1583384

Gary, Re <<A quick look at the result of AMD from the time the first K6 is available(April 97) till K7 will be available(Q299), it seems that K6 is losing money.>> I think a more correct phrase is that "...the time the first K6 was available(April 97) till K7 will be available(Q299), AMD (NOT K6) is losing money." Gary, AMD as a whole lost money. Their over all cost exceeded their revenues, that's all. That cost includes over-head, G&A and R&D (which paid for the development of K7) among other items. Each K6 sold, cost about 30% (of course this number changes all the time) less to make than the price AMD receives for them. AMD has maintained a positive GROSS margin on its CPU line, just not enough of the margin to result in positive NET margin (to pay for every thing else and still make money). Mani

To: Gary Ng who wrote (53034)	3/21/1999 11:04:00 AM
From: DRBES	Read Replies (1) \| Respond to of 1583384

RW: "it seems that K6 is losing money. So would it be wiser to Save the 500M which can pay for K7 by itself ?" It seems me that this is an extremely short sighted view. the K-6 series enabled AMD to buy or buy into the market, getting nine of the ten top boxmakers to accept and even promote ADM's chips. Also they now are amassing this enormous installed base of "3D Now" participants to build upon that iNTEL, which suffers severely from a NIH syndrome, will likely ignore and may not ever overcome due to its very late penetration at the high end of the market only so far; while AMD's penetration has been at the meaningful end of the market and very pervasive. Regards, DARBES