Advanced Micro Devices Inc (AMD)

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Haddock, I'm not so sure about the conclusion here.

Keeping in mind that I have never been a fan of using AMD's GMs to gauge the success of Intel's products, I think it's a forlorn conclusion to say that an increase in GMs means that Pentium 4 is losing competitiveness (at least, that seems to be the conclusion aiming to be made here). After all, AMD's product volumes have gone down during this period. In a sense, AMD is moving away from the "market share at all costs" mantra, and towards a "GMs are good for returning to profitability" mantra (a good thing!). They are controlling costs, rather than boosting ASPs. If the market perception really was gearing less towards Pentium 4 and more towards Athlon, AMD would be able to get higher ASPs or volumes, but this past quarter, they got neither. My guess is that manufacturing costs have gone down. That would certainly affect GMs. Maybe better yields? Process efficiencies? I'm sure there are other possibilities.