Advanced Micro Devices Inc (AMD)

[HailMary]

I got news for you AMD has not been making a profit selling CPU's for about a year

I guess you failed to look at AMD's Q3 earnings in any detail. CPG (the group that makes CPU's) made a profit of $19 million. That was in a quarter where A64 has no impact and Opterons still had very little (less than $5 million IMO). So they were even making money on mostly Athlon's selling for an ASP of $70. Even if it costs 2 times as much to make an A64 or Opteron, they are selling these for a much higher price, so they would still be making money on them.

Something to consider -

ASPs traditionally rise in Q4 and demand is up too so units should be up. Combine this with AMD shipping a higher ASP product than ever before in their history (A64 and Opteron), and my guess is an additional $100 million in profit from CPG alone in Q4. Add in the flash pickup, and AMD is likely to make north of $.20/share this quarter, possibly much greater.