Advanced Micro Devices Inc (AMD)

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Paul, Re: Again, Intel's not going away by any means, I just think they're about to have to face up to settling for a lesser share of the market than they'd ever dreamed.

AMD is clearly ahead with Opteron, and this is the first time in their history where they have a good chance at capturing a premium slice of the market. Even so, it takes years to change the trend more than a couple percent. I can believe explosive growth from the perspective of investor expectations - after all, the stock price leads financial performance by large bounds, sometimes. But these spikes in the stock quickly fall when the results don't back up the expectations. I currently have a long position, but I think it's important to analyze the competitive picture constantly to ensure that the tables don't turn once the battlefield is set for the next generation of products. Just because Opteron vs Xeon is in AMD's favor today, it doesn't mean the same can be said this time next year - or in 2006. I think we're trying to anticipate second or third order delivery here, with a performance basis set far into the future. If Intel continues to nullify AMD's advantages, then AMD may not be able to hold on to their design wins for more than the current cycle. I think we need to keep things like this in mind. Just because AMD has won the design, it doesn't mean that the win is locked in forever. Although, I'll point out that I am not suggesting any turning of the tables is imminent - just that we should continue to be vigilant in examining the environment and keeping an eye out for new data.