6.18.2007

AMD Not Invited to the Q2 Recovery Party?

It looks as if Q2 2007 is going to be a good quarter for the PC industry. Eric Savitz reports a strong 2nd quarter demand for the PC and PC-related components. He lists the following companies as those directly benefiting from the upturn as Intel, Nvidia, TI, Intersil and Fairchild. The following reason for the positive outlook follows:

  • Demand elasticity from low DRAM and CPU pricing, cutting the bill of materials for by upwards of $100.
  • Depleted IC inventory.
  • Higher-than-normal build at Dell to prepare for entry into the retail market in the second half.
  • Restocking at Hewlett-Packard after the company reduced inventory by more than $1 billion in its fiscal Q2 ended April.
  • Intel’s launch of new Santa Rosa notebook platform.

You’ll notice that 4 out of 5 of those reasons should affect AMD in a good way. Then why is AMD not included in Eric’s list? This could be an explanation.

Mr. Douglas McIntyre thinks that AMD’s storm wrecked Q1 will only be followed by another perfect storm of lower ASP, poor demand stiffer competition from its unrelenting competitor. Q2 of 2007 should be strong quarter for the PC industry but nobody seems to have invited AMD.

12 comments:

Anonymous said...

moral in dresden must be all time low after the outsourcing rumours.

Anonymous said...

Here's some analysis:

http://www.infoworld.com/article/07/06/18/Analysts-skeptical-AMD-outsourcing_1.html

Anonymous said...

One thing that doesn't make snes about the outsourcing rumors... Why would AMD outsource the NY fab production? Why BUILD it at all? Sure they are getting some subsidies form NY, but if they are going to go fabless or fablite, why even bother with the NY fab?

Also found it interesting about the TSMC rumors which has a different process than the IBM/Chartered/AMD consortia - if they are considering TSMC over Chartered what does that tell you about AMD's confidence in Chartered and/or the current process technology.

SPARKS said...

Whoa! Whoa! WHOA! Easy Wrangler! Let’s not get too hasty with the New York State deal! I LIVE IN NEW YORK AND PAY 80 BUCKS A WEEK IN STATE TAX (payroll)! Throw in $6000 a year in property taxes and you’ll know where I’m coming from! If you think this deal is going to fly with shape AMD is in now, I’ll sell you some pigs with wings!

That deal was contingent on a viable company who would employ people and generate revenue. At this juncture, AMD can’t get enough scratch together to build a pig sty. This was not a deal to pull AMD out of financial death spiral. Sure, the deal was cut for Upstate, but in Downstate we got a little place called Wall Street, you see. They talk you know, and the phone lines are burning. It ain’t gonna get prettier, further, not with my god damned money you don’t. That’s, of course, if the politicians in this state want to count their time their office with an egg timer. AMD doesn’t have enough scratch to keep up their end of the deal, anyway. Trust me; pigs don’t fly, neither will this.

I-- DON”T--- THINK---- SO000!!!

SPARKS

Roborat, Ph. D. said...

I think a lot of analysts are confusing the IBM R&D plant in Fishkill NY with the proposed new FAB in Luther Forrest.

Either way, the environment that brought up the idea of another AMD Fab is long gone. AMD's margins can no longer support in-house production and Intel is determined to keep it that way.

Anonymous said...

"That’s, of course, if the politicians in this state want to count their time their office with an egg timer."

You're kidding right? NY Democrats worrying about their job security?

To use your words Whoa! Whoa! WHOA! Easy Wrangler! Maybe at lower levels, but a 600Mil subsidy (or 1+Bil, whatever it is) is not going to cost any major politicians thier job in that state (I was born in NY)

On a side note, these reports of investigating outsourcing only reconfirms Abinstein's OUTSTANDING analysis that AMD's yields are 25-50% higher than Intel on his blog. I mean why would you want to continue to do more manufacturing in house if you hold a 25-50% yield advantage? I now need to go over to his site and apologize!

Anonymous said...

How times have changed.

SPARKS said...

Hey Doc, get a load of this. Sounds like an obituary or post mortem.

http://www.neoseeker.com/news/story/6816/

Sparks

Anonymous said...

A report by Deutsche bank dated 19 June 2007 suggests that Intel is shipping 45nm CPUs ahead of schedule while AMD's Barcelona schedule slippeth and that rumors about outsourcing to foundries by AMD, who depend on SOI, is even more questionable.

Rough times ahead. Strap on the seat belt and hold on tight.

Two weeks away from a potential Q2 revenue shortfall declaration by AMD.

Good luck to all those hardworking AMD employees who've been led right into an unfortunate debacle of Enron-like proportions.

While AMD Fab and other employees are sent packing, Hector will gleefully collect his golden parachute benefits and run another company into the ground.

Well done.

Anonymous said...

Hector should be sued for misleading investors. While Hector is collecting millions of dollars, he is ruining AMD's employees and it's investors.

Anonymous said...

Where is the report by deutsche?

Anonymous said...

Where is the report by deutsche?

You can try emailing ross.seymore@db.com and see if they can assist