Advanced Micro Devices Inc (AMD)

[Petz]

re:(me)<<<AMD's CPU revenues should grow at least 5% as Intel's fall 8%>>>

(chipguy)<<Seeing as AMD is larger than Intel by the ratio 8/5 you mean?>>

HailMary <He wasn't talking about units. Q1 is seasonally down in revenue for both. His statement makes no assumption about how much unit market share is shifted.>

Well, not quite. I'm sure chipguys comment was tongue-in-shik anyway. But I started with my overall market share assumption, which is that when AMD has a lead in the performance race, they can gain 2% per quarter in unit market share.

For Q1, I am assuming AMD's market share in # of CPUs grows from 16.5% (Q4) to 18% (Q1) and continues to rise by 2%/quarter through at least Q4. (It would be 24% at that point.)

So that my itself would result in 9% more units being sold by AMD in Q1 and 2% fewer units by Intel.

But total units will drop by ~5%. I expect ASP to rise 1% for AMD and fall by 2% for Intel. AMD's rises mostly due to the greater proportion of K8 chips in its sales while Intel's falls because of no mainstream $600 desktop CPUs.

So, combining all the numbers to get CPU revenue change for AMD, we get 1.09*0.95*1.01, which gives a 5% gain in CPU revenues.

For Intel, 0.98*0.95*0.98, gives a 9% decline in CPU revenues, which is scraping the bottom of their recent guidance, but maybe Comm and more chipsets can keep it in the center of guidance.

Petz