Business Week on INTC vs. AMD

[HenryTo]

Let's see if Intel can pull another rabbit out of the hat:

http://yahoo.businessweek.com/magazine/content/04_48/b3910050_mz011.htm

Historically, Intel has nearly always been able to deliver when they're backed into a corner - but whatever the case may be, this intense competition between Intel and AMD can only be good for businesses and consumers (unless you were an Intel investor, of course).

[HenryTo]

Everybody loses in the short-run but I expect INTC to ultimately come out ahead. They're now pushing quad-core up from 1Q 2007 to 4Q 2006. It has been a long time since INTC has done this:

http://www.dailytech.com/article.aspx?newsid=3421

[rffrydr]

Intel's inventories go from 81 days to 103 despite heavy disounting Pentium. In "war" everybody looses.

[HenryTo]

AMD misses. I expect AMD to start posting losses again sometime next year.
-----------------------------------------------------------------------------------
Advanced Micro Devices misses, stock falls
Thursday July 20, 4:29 pm ET
By Jessica Seid, CNNMoney.com staff writer

Advanced Micro Devices reported Thursday sales jumped 53 percent in the latest quarter but fell short of Wall Street's expectations.
Shares of AMD fell in after-hours trading.

The No. 2 chipmaker behind Intel reported earnings of 18 cents a share for its fiscal second quarter ended July 2, up from three cents a year earlier. Analysts had been looking for profits of 22 cents a share, according to a survey by Thomson First Call.

Sales slipped to $1.22 billion from $1.26 billion a year ago, below forecasts of $1.25 billion.

[HenryTo]

The Intel empire strikes back with the release of the Core 2 Duo and the Core 2 Duo Extreme:

http://www.anandtech.com/cpuchipsets/showdoc.aspx?i=2795

[rffrydr]

Intel cuts 1000 managers. How good can the second half be?

http://www.sacbee.com/content/news/story/14277679p-15086694c.html

[HenryTo]

Looks like AMD may be officially "toast" here.

http://www.anandtech.com/IT/showdoc.aspx?i=2793&p=1

Not only does Woodcrest outperform AMD Opteron in most cases, it also does it with less power consumption. And finally, it looks like that INTC still has quad-core up its sleeves before AMD even has an answer to Woodcrest.

[HenryTo]

Intel officially declares war on AMD:

http://www.fool.com/News/mft/2006/mft06070719.htm?ref=foolwatch

[HenryTo]

Rumors of a price war have been in place since June 2nd - when the Register first started circulating what was thought to be a rumor at that time. This probably made up a significant chunk of the weakness in INTC recently. And it now looks like that Intel will eat AMD's lunch later this year in the server market:

http://www.anandtech.com/IT/showdoc.aspx?i=2772&p=11
----------------------------------------------------------------------------
Intel says set to cut prices more quickly
Thu Jun 8, 2006 6:11 PM ET

By Scott Hillis

SAN FRANCISCO, June 8 (Reuters) - Top microprocessor maker Intel Corp. <INTC.O> can cut prices on older chips more quickly than in the past thanks to its aggressive adoption of new manufacturing technologies, a spokesman said on Thursday.

The maker of Pentium chips has trimmed prices in recent months as it moves to clear inventories and halt market share gains by rival Advanced Micro Devices Inc. <AMD.N>, and many analysts say they expect steeper cuts in the coming months.

"We have a more aggressive product and manufacturing ramp, so those older Pentium products will move down faster," Intel spokesman Chuck Mulloy said. "It's not like we're cutting prices for the sake of cutting prices."

Intel, which makes about 80 percent of the processors found in personal computers, is at the leading edge of using the latest manufacturing techniques to etch circuits as small as 65 nanometers, a width that is less than 300 atoms across and more than a quarter thinner than the previous generation.

The smaller chips are not only more energy efficient and powerful, but also more profitable for semiconductor companies because more can be cut from a single slice of silicon.

Intel is trying to clear the path for its new line of processors based on a fresh design called "Core" that analysts say helps close the performance and power efficiency gap with AMD's chips.

Core is pushing the Pentium line, its previous flagship products, to the bottom of the company's product portfolio.

"We're going to be able to ramp so quickly with the new (factories)," Mulloy said. "You'll see more of the 65-nanometer Core architecture products at the end of the year than you would see in a historical pattern."

CORE VALUED

Intel will launch its Core chip for server computers that run networks this month, followed by a new desktop processor in July and a new laptop product in August, Mulloy said.

"We're going to gain market share with the new products. That's where we're going to be focused on the market share," he said.

Mulloy declined to comment on specific price cuts, but Citigroup analyst Glen Yeung said in a note on Wednesday that, based on talks with Intel customers, Pentium prices could fall by between 8 percent and 61 percent by late July.

Concern over a price war led Yeung to cut 2006 profit estimates for Intel by 10 percent, to 77 cents a share, and for AMD by 11 percent, to $1.14 per share.

JoAnne Feeney, vice president of research at Punk, Ziegel & Co. who has a "buy" rating on AMD, nonetheless said the smaller company would struggle against Intel's price cuts.

"The one concern I have is that Intel is in pretty dire straights in terms of getting rid of their old inventory and old chips," Feeney said. "What we're seeing now is a lot of people sitting around waiting to see what the next prices will look like, and that's hurting AMD."

Jim McGregor, a semiconductor analyst with research firm In-Stat, said Intel's plans to start 65-nanometer production at a fourth factory this year could lead to further mark-downs.

"If the economy goes, the market goes and demand stalls, it could be a big issue," McGregor said. "I think Intel's already trying to get aggressive on the pricing." (Additional reporting by Duncan Martell in San Francisco)

[HenryTo]

Don’t buy any desktops or laptops until later this summer. Desktop processors will be "refreshed" and price cuts will happen on July 23:

http://www.dailytech.com/article.aspx?newsid=2547

Notebook processors are expected to be “refreshed” this August:

http://www.dailytech.com/article.aspx?newsid=2546

[HenryTo]

Some solid evidence suggesting that INTC will outperform AMD in the server market very soon:

http://www.dailytech.com/article.aspx?newsid=2487

[HenryTo]

Morningstar on Dell finally using AMD processors. Not too big of a hit to INTC - and I agree. That is why I picked up some INTC on Friday morning at $18.03 and hoping to ride this "bounce" at least into next week. Moreover, there is reason to believe that INTC's microprocessors will finally leapfrog AMD's by the end of this year.

http://www.anandtech.com/cpuchipsets/showdoc.aspx?i=2748&p=6

http://www.realworldtech.com/page.cfm?ArticleID=RWT030906143144&p=11
--------------------------------------------------------------------------
Dell said Thursday that it will include Advanced Micro Devices' AMD Opteron server chips in its high-end server line by year-end. Although this is a shot in the arm for the chipmaker, we are maintaining our fair value estimates for AMD and Intel INTC. Dell had been an Intel-only shop, but the market has demonstrated a strong preference for the Opteron chips, as witnessed by the growth in AMD's server chip market share. We believe Dell is including the AMD chip to capture sales it may not get otherwise.

We think this could open up some longer-term opportunities for AMD, but we're not convinced that it will amount to much in the short run. As of the fourth quarter, Dell had 20% of the server market; by including AMD in its server lineup, it expands AMD's addressable market by 25%. In addition, we think this increases the possibility that Dell might include AMD's notebook and desktop chips in its lineup. However, we believe it may be difficult for AMD to realize the full extent of this opportunity. For now, AMD is only in Dell's servers. In addition, Intel is coming out with chips that narrow the performance gap with AMD. Should Intel decide to really slash prices on its servers, the rationale for customers to choose AMD could disappear altogether.

[HenryTo]

AMD roadmap updated:

http://www.dailytech.com/article.aspx?newsid=1702

Also, desktop sales are still growing despite the popularity of laptops nowadays:

http://www.dailytech.com/article.aspx?newsid=1717

[rffrydr]

....except for one problem, it seems to me: computers already do everything WE want them to do.

What's the killer app?

[HenryTo]

There's a real chance that Intel's top-end processors will start outperforming AMD's later this year - given that Conroe is scheduled to be released by the third quarter of this year:

http://www.anandtech.com/tradeshows/showdoc.aspx?i=2716

65nm and dual core isn't too exciting, IMHO. But 45nm and quad core sure does - and coupled with the release of MS Vista later this year, we should experience a surge in both hardware and software upgrades come 2007 and 2008.

At this point, this author is not buying INTC just yet - but am definitely watching.

[HenryTo]

A "geek debate" on INTC vs. AMD. Warning: Some of the posts may be offensive or seem amateurish to some readers:

http://www.dailytech.com/article.aspx?newsid=550