Intel Corp (INTC)

[chipguy]

AMD's earnings prospects are strongly dependent on how fab
costs and under utilization charges are split between AMD
and GF.

Intel's ability to control and crush AMD's pricing power while
continuing to take unit market share is more likely to increase
next year rather than decrease. With AMD processor ASPs
under ever increasing pressure manufacturing costs will be
critical as AMD rolls out hex core desktops and dual die MCM
server chips.

If GF achieves *true* cost plus basis pricing of wafers spun
for AMD it will IMO be hard for the latter to generate profitability.
If Abu Dhabi is happy to let GF sell wafers to AMD at artificially
low prices and suck up the loss themselves then AMD could
"earn" quite a few bucks. The cost efficiency of AMD+GF has
not been improved by divesture, it has been made worse by a
larger corporate overhead. It is simply an acounting matter of
who gets to take one for the team.