Replies to post #24137 on Advanced Micro Devices Inc (AMD)

[sgolds]

Elmer -

Intel could easily design the highest performance product in the world if they didn't care if it was manufacturable or could produce a profit.

Is that so? Was RDRAM manufacturable? How about the huge-die Itanium? Soon we will see about Prescott - the rumors are in full agreement that it is difficult to manufacture. Meanwhile, IBM's 90nm PowerPC processors seem to be running cool and at low power (a good sign for AMD's similar 90nm process).

Yes, Intel is profitable. Please do not confuse market momentum with excellent technology, they are not the same. A company can coast a long way on momentum, and Intel has done an excellent job keeping profitable through the downturn. Their marketing and accounting are second to none. Meanwhile, AMD has put together some simple ideas (64-bits, on-die memory controller, point to point interconnect) and one difficult idea (SOI) to start their own momentum in the corporate world.

Yes, Intel has been a great investment in the 1980s and 1990s. However, for the past 5 years, AMD has been the better investment. This started with the K7 family, the processor which got AMD out from under Intel's technological shadow. A five year record of beating Intel in the stock market should not be ignored.

[HailMary]

Intel's profit now is largely on the back of past success and excellent manufacturing of existing quality products (P4, mobile, etc). They have positive momentum, which can carry on for a while. The delays and problems in their new products will be more apparent to the bottom line in the coming year or years. There is still time for them to correct all these things, and I'm not saying they won't. It just appears to an outside observer that things are not running smoothly (other than manufacturing).

I'm trying to determine future profits of both companies so I can make better investment decisions. Didn't mean to turn this into Intel vs. AMD argument, but I guess that goes with the territory.