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Congratulations. I felt the same way, but watching AMD dropping every day finally got to me and I got out at about $7 when I should have been buying. At that point I was still ahead, but made a tactical decision that turned out to be wrong. It's much better to buy a stock at $3 and watch it go to $30 than to buy it at $15 and watch it go to $30. Buying low really helps the multiplier.
The trouble was that during all the typical pullbacks of the 90's the stocks would drop 30 to 60% and then recover 30% within 3 months of hitting bottom. The crash that started in 00 and ended in 02 took no prisoners in any Tec’s with drops of 80 to 90% being the norm. Towards the end there I was beginning to believe the Tec’s would never recover.
Any way it all worked out and I've now got an AMD 4 or 5 bagger with much more to come. That's not too bad for 5 or 6 years of investing. And it's not like AMD hasn't given us plenty of chances to make gobs of money on it. My trouble has been that I've been much better at recognizing the up drafts than the down ones.
After the last couple of months I doubt that there are many AMD longs that need to worry about the poor house, unless they want to buy it. I wonder if it has a view?
No doubt about it INTC still has a lot of strengths, but at the same time INTC has been spending its inheritance like the profligate son. All this bumbling around is giving AMD too much of a shot at changing things. And as you say once changed it's difficult to change back.
I hear you. Fortunately my wife isn't prone to throwing things, at least at me, but she was not a happy camper. I had been selling and buying back at lower prices all the way down so I had about twice as many shares when I finally became dispirited and got out. That was about $7 and I didn’t get back in until AMD had recovered to about $7 again, missing the chance to double my shares again.
The good news was that by the time the stock got back to $10 I was allowed conjugal visits again.
What defines a super-platinum member?
Yes, it's tough watching the stock do nothing but climb.
It's really funny the way things happen. AMD really isn't that much different than it was 6 months ago. All the pieces were in place then, even the help from INTC, but not too many could see where things were going.
Fundamentals get you into the right church, but it's the timing thing that answers your prayers. It's always nice, and profitable to be right, even if it takes awhile.
I can't rember the exact number, but I was impressed. I'm going to listen to the CC again but skip the fluff.
I'm always looking for an exit point, but now is not the time. Like I just said go listen to the CC. There's a lot of in debth information there. Listen particularly to what Bertrand and Derk have to say.
Did you listen to the analysts meeting? Either flash or CPG alone would be enough reason for me to be buying AMD at its present price. Together they sound explosive.
Seriously, you INTC guys should take an unbiased look at AMD. You might like what you see.
It's no secret that I've been something less than impressed with AMD's EPS, but at the same time things have never looked better for the company. Anyway, the market seems to be buying the sizzle and hoping there's bacon. One thing is for sure, the comparisons between AMD and INTC revenues should continue the same pattern that has emerged over the last year. INTC certainly isn't the growth company AMD is, nor is there much hope that the situation will change any time soon.
This q should be reasonably good for AMD, but next year should see continued growth at rates better than AMD's competitors or other silicon companies. The point is that AMD isn't going to be doing the boom and busts it used to. Over the long run that will be a lot more impressive. If I owned INTC stock I would be very worried.
Well I'm stoked.
Sure would have liked to listen to the Q&A. I wonder why they cut us off, but they did the same thing last year.
Anyway, anyone at all interested in AMD needs to devote the 3 and half-hours needed to listening to the presentation. Lots of very good information, I'll probably listen to it again when it becomes available.
To me it sounded like flash is going to be bigger than CPG eventually, but the PIC concept sounds awesome. There's little doubt about AMD’s growth being enormous for the foreseeable future.
That's kind of the way I remember it. In any case the problem probably becomes moot with fab36. I'm sort of wondering just what AMD's production plans are. Right now, with the addition of Chartered they seem to be an "equal opportunity" out-sourcer. As far as I know UMC still manufactures AMD's chipsets and I think Alchemy, TSMC does the Geode, and I would guess Chartered is probably going to do the high volume 32 bit stuff?
The whole picture is somewhat confusing right now. I'm still wondering what AMD is going to do to meet processor demand in q2/3/4 of 05 which seems like it will be crunch time. There could be a year or so lapping 05/06 in which AMD is capacity constrained. I certainly hope everything that can be done is being done to bring up fab36 at the earliest moment. All the good AMD64 press AMD has been getting is definitely going to translate into big increases in demand at some point next year.
Well, my memory isn't all that hot anymore either, but for some reason I remember the CC where Jerry was answering a question from an analyst about the production restrictions.
I don't have a link either, but it was the "finger lickin good" colonel that said it. Talk about "finger lickin good", that certainly describes today.
I bet Jerry is having a hard time keeping from telling anyone that will listen "I told you so".
A couple of years ago AMD ran a contest on the Internet and the prize was an AMD T-shirt. I wear the damn thing every time I go to CostCo, Best Buy, etc. IM a friggin billboard, AMD ought to be paying me. Well, I guess in a way they are. T-shirt is getting a little old though. I wouldn't mind getting another, even if I had to pay for it.
And yes, I would be gladly wearing an INTC T-shirt if I thought enough of the company to invest in it.
New CEO, will this make a difference, hardly.
http://story.news.yahoo.com/news?tmpl=story&cid=580&e=2&u=/nm/20041111/bs_nm/tech_intel_...
I'll agree they have to do something with all that capacity or it will definitely start dragging down margins and everything else. We'll have to see how successful large cache is in increasing performance/sales. Right now that seems like INTC's only option.
I'm not sure fiber to the curb will do much for INTC, maybe CSCO or some of the other guys. INTC seems to be hanging its' hat on WIFI and WIMAX or whatever finally becomes standard. Actually, I like INTC's emphasis on the Media Center stuff, and wish AMD was doing more in this area.
It does look like the world is finally going fiber for heavy lift and wireless for the personal communicators. Looks like cell-phones and their replacements are going to be able to use a plethora of frequencies. This should be a very good market for both AMD and INTC. It will be interesting to see if INTC can finally intrude into MOT and TI's territory. As usual AMD will be more inclined to work with others rather than go for the whole enchilada themselves.
Sounds like a rehash of what we've been saying for at least the last year or so. All in all a scathing indictment of INTC management.
How much longer before INTC stockholders start warming up the tar and getting out the feathers?
Could be that MSFT wants to separate home media from business PC's. More products, more sales?
Maybe it's just as simple as INTC realizing that they will need a lot less money for P&E going forward? It's hard for me to believe that INTC will need more fabs especially with the LCOS bust. Anyway, it seems like the plan is to convert existing plants to 300mm, and it looks like future shrinks will take more and more time to do. All in all this is probably as much a recognition that less funding will be needed as anything.
Your right though, this is what middle aged companies do. If you don't have anything better to do with the investors money it's always better to return it to him, one way or another.
As I've said many times I'm about as non-technical as they come so feel free to ignore what I'm going to say. But even to me, with my limited knowledge, some things seem apparent:
1) FSB’s are about as dead at dodos.
2) The future is in PTP architecture such as HT due to its' low latency and scalability.
3) Also Big Iron is dead, being replaced with chips that have multiple processors on them and linked to other such chips with PTP and system integrated with high speed switches such as the new PathScale product.
4) By the time Montecito hits the market AMD should be selling 32/64 processors in a 3 cubic foot box. Commodity servers are going to rule the server market from top to bottom.
I will give you that Itanium isn't going to go away any time soon. The products will make just enough money to justify their existence until something better(Xeon merger07?) comes along. The point is why bother? But then I guess INTC has to offer something or loose the market completely.
In any case the market AMD is situated to take is going to be much bigger lapping both the Itanium and Xeon markets. It doesn't look like INTC will have anything to protect that huge middle of the server market for a very long time.
Media center PC's.
http://www.theinquirer.net/?article=19589
They're getting closer. The author, Marc Ninthly, though is missing the point. Eventually the PC will move from the living room to the closet and be connected to all the other dumb devices around the house wirelessly.
Best to think of the Media PC as a gateway to the internet and an easily accessed repository of all the media trash you want to save. Of course there are still a few bugs to be worked out and some decisions to be made but the biggest problem seems to still be the intellectual property issues.
Eventually the Media PC will replace the current PC standard in every home.
Dual core Itaniums?
http://www.cbronline.com/article_feature.asp?guid=50C0D3A2-51F7-4C17-AAC0-5B7B621A099A
Them...
9 Nov 2004, 18:10 GMT - To hear the top brass at Intel talk about it, everything is fine and dandy in Itanium land. The fact that the dual-core 'Montecito' Itanium processors have been pushed out to a volume ramp up in the first half of 2006 is not only not a problem, they say it was the plan all along. Timothy Prickett Morgan investigates...
From the outside, it looks like Intel is constrained as much by the 130 watt heat dissipation envelope for the top-end Itanium as it is by the yields on its current 130 nanometer and future 90 nanometer processes.
Me...
Saxman post.
Interesting, if it wasn't to be IBM then Chartered would have to be the second choice given their close association with IBM.
It's hard to say how well this will work, kind of sounds like UMC repackaged, but for sure it says a lot about demand for AMD's products, or at least what AMD's management thinks about demand for AMD products.
"and now with this relationship, the incremental capacity to fulfill our planned volume demands. We believe that all of our customers around the globe will benefit from this relationship."
I'm still wondering about fab36. When that comes online AMD should have enough capacity for every processor needed for a very long time. Maybe their farther along but it sounds like it will be late H1 or early H2 before Chartered is able to start producing parts.
"Chartered will begin integrating APM into Fab 7, its 300mm wafer fabrication facility in Singapore, starting in the fourth quarter of 2004."
Maybe fab36 will be later than expected coming online, but it doesn't seem to make much sense to get into this kind of arrangement for a couple of quarters production? Or maybe AMD has other plans for fab30?
NOR prices stabilizing.
http://www.digitimes.com/news/a20041022A4018.html
8 and 16Mb is where INTC is pushing, but AMD is big there also.
Some 10q clarifications. Here's some of the things talked about recently that have been cleared up in the 10q.
1)We use a 52- to 53-week fiscal year ending on the last Sunday in December. The quarters and nine months ended September 26, 2004 and September 28, 2003 each included 13 weeks and 39 weeks.
2)The increase in net sales was driven primarily by increased microprocessor sales across all markets, with a 12 percent increase in average selling prices and a nine percent increase in unit shipments.
3)Computation Products net sales of $672 million in the third quarter of 2004 increased 34 percent compared to net sales of $503 million in the third quarter of 2003, primarily as a result of a 23 percent increase in average selling prices and a nine percent increase in unit shipments.
4)Computation Products net sales of $1,797 million in the first nine months of 2004 increased 30 percent compared to $1,379 million in the first nine months of 2003. Net sales increased primarily as a result of a 24 percent increase in average selling prices and a five percent increase in unit shipments.
5)Memory Products net sales of $538 million in the third quarter of 2004 decreased 20 percent compared to net sales of $673 million in the second quarter of 2004. The decrease in net sales was primarily attributable to a 14 percent decrease in unit shipments and seven percent decrease in average selling prices.
6)In particular, net sales in Asia decreased 21 percent primarily due to a decrease in demand from the wireless handset market, in part due to channel inventory accumulation by wireless handset OEMs in China.
7)Memory Products net sales of $538 million in the third quarter of 2004 increased 27 percent compared to net sales of $424 million in the third quarter of 2003. The increase in net sales was primarily attributable to a 22 percent increase in average selling prices and a five percent increase in unit shipments of Spansion Flash memory products. Average selling prices and unit shipments increased from the third quarter of 2003 due to increased market demand, especially in Asia, where net sales increased 40 percent compared to third quarter of 2003.
8)The impact of this decrease was partially offset by a decline in manufacturing costs due to our transition to 110-nanometer process technology for certain of our Flash memory products as well as increased shipments of Flash memory products based on MirrorBit technology.
9)All Other operating loss of $36 million in the third quarter of 2004 increased by $6 million compared to an operating loss of $30 million in the second quarter of 2004, primarily due to a decrease in demand for certain of our embedded microprocessor and networking products.
http://biz.yahoo.com/e/041104/amd10-q.html
AMD gains market share:
http://asia.cnet.com/news/systems/0,39037054,39199776,00.htm
Those figures include sales of chips for Microsoft's Xbox, an exclusive contract for Intel. (Like other research companies, Mercury sometimes will revise market share figures after an initial release of data, so the market share figures do not match previously published figures from Mercury, but the numbers generally only vary about a tenth of a percentage point.)
But there is a crucial difference between then and now, Mercury's Dean McCarron noted. In 2001, AMD was losing money, and it was on track to losing more money than it had made over its history. Now it's profitable. "In the overall scheme of things, that is a good sign," he said.
The point I was trying to get at is what's INTC doing in this market? I thought Alan81 said that INTC wouldn't be interested in a chip that sold for less than $2. Yet the article said that the market was set to double form $.5B to $1B by 07. That doesn't sound like chump change to me even if the margins are tight.
More importantly, this sounds like a way for AMD to push mirrored flash and enter into the fast growing NAND market.
Of course I'm not a tech, and I'm probably misunderstanding some of the implications, but at face value it sound good.
Boy I sure hope your right and 90nm ramps big time. AMD will definitely need the capacity as 05 progresses. Interesting point about Geodes. Ya, 06 will be the first time AMD has ever been able to put the hurt to INTC in a meaningful way. I'm really looking forward to fab36 coming on line. Chickens will be roosting all over the place.
No I wasn't aware of that, thanks. What Mb sizes are they produced in and what is the size of the package?
I agree, but 90nm seems to be ramping way slower than I thought it would. I really don't know what is going on, but for now I'm assuming a gradual ramp in 05. AMD should be able to produce a couple more million processors at 90nm, but I've been through this before and I'll believe it when I see it.
In any case a couple M more units, while doing wonders for AMD's bottom line, won't do much to market share and certainly won't cause INTC any problems.
Ok, I don't really disagree with you and your figures. But consider that the total processor market is going to be about 190M+ processors this year which translates into about 16% market share for AMD. Assuming AMD produces 8M units a quarter, that's a drop in the bucket. While AMD does have the capacity to choose markets to target and one would definitely hope that the target the most lucrative ones, there are limitations based on AMD's commitment to covering all markets in which they compete with INTC.
This situation will only get worse next year as AMD nears 90nm capacity. The latest estimates I've seen expect 5% growth next year compared to this years 13%+ growth. 5% growth would be about 10M more units or 2.5M units per quarter. In order to retain market share AMD would have to produce about .5M more units per quarter next year. That sounds feasible to me, but isn't anything that is going to keep B&O up nights. Nor is it going to do much for AMD’s market share.
Your right though, AMD should get progressively more profitable as we go through 05, as long as AMD retains the technology lead.
Hope your right. Did you read this part?
Them...
For low-density designs, 1 and 2Mb products are currently available in production volumes. Customers are actively sampling 4Mb devices and beginning to sample 16Mb products, and Spansion plans to extend the family to 8, 32 and 64Mb densities in 2005. As applications continue to evolve and memory requirements increase, MirrorBit technology's proven scalability will enable additional, higher-density solutions.
Me...
So next year AMD will have 64Mb parts that are much less expensive to make and buy in a form factor thats 80% smaller all running at "Spansion's best-in-class operating frequencies up to 50 MHz". Sounds to me like INTC has got another major problem on it's hands.
I'm only peripherially aware of what is going on at Apple, but hasn't a lot of the share price gain been due to the ITunes and IPOD business.
http://www.winnetmag.net/Article/ArticleID/44376/44376.html
One area into which the iPod's success hasn't translated is Apple's long-languishing Mac line. Although Apple had hoped that a swell of iPod customers would result in higher sales of the pricey but elegant Mac, that hasn't been the case. According to Gartner, Mac's worldwide market share fell to 1.8 percent in the most recent quarter, down from 2.1 percent in the same quarter a year ago. (Annual computer sales figures placed the Mac market share at 1.7 percent for calendar year 2003.) In the United States, the Mac's market share dropped from 3.6 percent to 3.2 percent in the same time period.
Boy ther's a lot of information in that post.
I especially liked:
SPI enables advanced packaging options that require 80 percent less board space and 75 percent fewer electronic connections than traditional Flash devices in standard TSOP packages.
Sounds like the Saifun and Spansion relationship is getting even closer. It sounds like this should be a win for Mirrored flash also. Best thing is that this sounds like an AMD exclusive, no INTC inside.
How is INTC going to be able to compete with this product? Mirrored flash already costs less to produce than Strata and now the chips will be smaller still with less connections.
1 and 2 Mb products are available and more to come in 05. Of course this being a new standard it could take a while to gain traction, but if the cost advantages are what they seem this could turn out to be really big.
Very nice post. This sounds like what Hector may have been alluding to when he said mirrored bit would be competing in the NAND markets.
Them...
Spansion FL Flash memory products will help designers to develop the next generation of smaller, lower-cost consumer and automotive electronics including DSL and cable modems, DVD/CD players and recorders, optical and hard disk drives, LCD monitors, digital TVs, PC BIOS and printers.
Me...
That's a pretty impressive list of products.
I thought that was what I said. Where are you? Should you be in bed?
AMD isn't going to get into any price war unless INTC instigates it and that's very unlikely. AMD is going to use the next year to build up reserves, and take a little market share because of its' superior products. Once fab36 comes online you can then expect AMD to then start lowering prices in an attempt to gain market share. Until fab36 comes online AMD will have to be satisfied with making increasing amounts of money.
Of course INTC could change all that if it suddenly released products that competed better with AMD's, but given today’s release it looks like AMD doesn't have much to worry about.
I think you misunderstood what I said. In order to have a price war a company has to have the capacity to back up its’ lowered prices. Otherwise the other party just lets you sell all your stuff at the lowered prices and then it supplies the entire market at even higher prices. This is especially evident in AMD/INTC's case where market share is so disproportionate. INTC doesn’t fear AMD because they know AMD can’t threaten their prices. That all changes when fab36 comes online. At that time AMD will finally have enough capacity to affect INTC pricing.
For the time being AMD could pick certain markets, such as servers, and do some damage, but that would require changing the product balance and INTC would react accordingly. Hector seems to be a pretty cool bird. I’m pretty sure he is more than willing to strengthen AMD’s finances and put off the inevitable war until he has his ducks lined up.
I like my wording better, it's more graphic, but either way the point gets made. Personally, I like the idea of AMD milking the market; INTC has been doing it for years. Equal opportunity and all that.
True, it's difficult to see how AMD could cause INTC much pain without having a lot more capacity. A price war would undoubtedly hurt INTC more than AMD, but to do so you need the capacity to back up your lowered prices. But, sigh, there are only a few areas where AMD has the kind of clout to cause INTC to even think about lowering prices. So far INTC has wisely refused to get into a price war.
Given AMD's capacity constraints, AMD has evidently also decided not to push sales through pricing, preferring to milk the market. AMD's superior products will probably be sufficient to create enough demand so that AMD can sell everything fab30 can produce at relatively high prices. The problem is that by q2/q3 of next year AMD isn't going to be able to meet demand. In the short run AMD will fix this by raising prices, but then it loses a golden opportunity to gain market share.
By the end of q3 AMD should be making gobs of money, but they will need it when fab36 comes online and the mother of all price wars starts. Of course that assumes that INTC will have caught up with AMD by then in product design. If not AMD just meets the built up demand and starts taking market share again.
Right on. I expect we haven't seen anything yet. As AMD continues to tighten the processor vice on INTC's balls INTC will dip more and more into that trove of cash it has to try and dissuade anyone from having anything to do with AMD.
To me flash looks like the area in which INTC wants to make the biggest statement. It certainly looks like the flash manager has been given carte blanche to do what ever it takes to recover market share. AMD may be hurt some this quarter, but INTC's financials should make very interesting reading as flash will undoubtedly go further into the red. I'm still not sure just what INTC is up too, but it has to be costing them dearly.