A friend and good customer emailed me a copy of a news article that stated “AMD Shares Drop After Dell Rumor Quelled”. This friend is heavily invested into many successful companies, and he asked for my opinion on this news.
I had to laugh when I read this article, because you figure an analyst would perform real research before making sweeping statements. Personally, I only trust investment firms who deal with companies like Gerson Lehman as they tend to pay top dollar for informed research.
I’m not professing to be a stock analyst, but I do understand the technology and the roadmaps better than any analyst that I have ever had the pleasure of speaking with.
I figured I’d dissect this news line by line.
NEW YORK (AP) -- Advanced Micro Devices Inc. shares dropped sharply on Friday after a Wall Street analyst said the chip maker's fourth quarter may be its "last quarter of strong momentum" and shot down rumors that the company may land a deal with Dell Inc.
First of all, the AMD / Dell rumors are just that at the moment, rumors. No one really knows what’s going on the inside of either of these companies. Being that my company VoodooPC is on the leading edge of technology, we see trends months in advance. Typically you can follow a company like Voodoo and watch our buying patterns and make informed decisions on future mainstream trends.
Therefore based on how leading edge companies like Voodoo and Alienware buy months earlier one can pretty much predict the future in tech. I’m not saying it’s an exact science but if you ask anyone in my field it’s pretty darn accurate.
So, the CTO in me has to look at what AMD has done in the server and workstation market, which is really the bulk of the business for any large OEM. The AMD Opteron 64 is not only the clear choice for servers and workstations, but the road seems to be clear up until 2008 and beyond.
We will witness as shall AMD continue to eat away market share in the server and workstation market like Pacman eats dots. This trend will continue to grow as long as the people working in I.T. departments understand the technology that they’re procuring.
To be blunt, you’d have to be blindfolded, hearing challenged, and your hands tied behind your back to assume that the AMD Opteron 64 isn’t a superior alternative to anything their competition has to offer. The AMD Opteron 64 is a silicon gladiator, and any tech savvy person knows this.
As well, you need not be a Wall Street analyst to understand that AMD doesn’t need Dell to continue to grow their business. In fact, I would venture to say that if anyone chooses not to go the AMD route in the server and workstation market they will continue to lose ground. HP, Sun, Rackables, and others are secretly enjoying their success with Opteron.
I haven’t even touched on their retail business – but anyone with eyes knows that AMD is doing incredibly well on the consumer side.
Deutsche Bank analyst Ben Lynch, who downgraded the stock to "Sell" from "Hold," said although the Sunnyvale, Calif.-based AMD will likely report a strong fourth quarter, competition from Intel Corp. could stall AMD's momentum in 2006.
"We believe Intel's roadmap refresh and improved product availability will increase its competitiveness versus AMD, leading to slowing AMD momentum in calendar year 2006," Lynch wrote in a research note.
I’m not sure which part of Intel’s roadmap Mr. Lynch was reading. Clearly he missed the fact that AMD is launching their highly anticipating next gen platform in the coming months, not to mention their Opteron business will continue to grow as they face no technical competition for many months to come. It's almost as if he assumes AMD will press the pause button and wait with great anticipation as Intel finally catches up.
Now on the flipside, Intel has made some good moves with their new notebook platform. They finally launched a dual core product that’s worthy of being branded dual core. Although it doesn’t currently support 64 bit, it’s still a pretty decent step up from their previous generation. They also managed to launch this platform into Apple’s new notebook and desktop line.
Then Apple turned around and launched an advertising campaign bashing all of Intel’s customers on the PC side. Woops. I wonder if Paul wore his bunny suit and hopped on over to Michael's office apologizing for the brutal ad campaign.
That aside, it's no secret that Intel's Team Isreal is strong, and they have been carrying the entire company on their back for months. So we can look at the how the AMD Turion 64 compares to the Intel Core Duo (Pentium M Dual Core).
Typically when the ODMs in Taiwan start buying into a particular technology you can assume that the trends on this side of the pond will start to change. The fact that the AMD Turion 64 is a relatively young processor; it’s an amazing success story. It started off as a chip and nothing more, but has quickly evolved into a developing platform where more ODMs are starting to build around it. As we have seen, AMD designs some killer chips. When we combine these with a well designed platform we start to unlock features that enable the technology to perform like no other. I see many new platforms around the corner that will elevate this technology to achieve to an entirely different planet.
...and shortly VoodooPC will be launching the world's fastest notebook - no question, uncontested, no one will touch it. Guess what processor it's running?
Further, the analyst said rumors that AMD may soon sign a deal with Dell seem unwarranted. "Contrary to some recent market talk, our checks indicate that AMD is not likely to penetrate the Dell account any time soon," Lynch wrote.
Contrary to what Mr. Lynch suggests AMD doesn’t need to penetrate the Dell account. Based on the history with AMD and Dell it might be the other way around. Don’t take my word for it – I mean, what do I know?
Dell is way too smart to allow companies like Sun and HP chip away at their server business, and unless the Intel Roadmap I read was covered in peanut butter, there is little doubt that Dell will try to align with AMD. Michael Dell is no fool, and he will do what’s right for Dell and their shareholders. I don’t think they are married to anyone at this point.
Analysts polled by Thomson Financial expect the company to earn, on average, 25 cents per share for the fourth quarter on $1.66 billion in revenue, and 88 cents per share for 2006 on $5.62 billion in revenue. Shares of AMD, which have traded between $14.08 and $37.46 over the last year, were down $1.49, or 4.2 percent at $33.86 in afternoon trading on the New York Stock Exchange. Shares of Intel, which have traded between $21.89 and $28.84 over the last year, gave up 9 cents to trade at $25.88 on the Nasdaq.
I don’t make stock recommendations - although I will make one to Mr. Lynch. Sir, perhaps you should sell your other stock and double down ;-)
I make buying recommendations on technology because I understand the dynamics of this market inside and out. What I can say for sure AMD is wowing the tech community with their technology, and doesn't that translate into financial success?
I'm pretty sure that AMD’s management team has no intention of taking a back seat to anyone anytime in the near future. AMD is acting incredibly modest, and it’s about time their customers started speaking out and telling it like it is.
Looking forward to the love letters, as always thanks for reading.
UPDATE: After 30,000+ unique visits in less than 24 hours I wrote a follow up post here..
24 blogger comments:
I think your comments are a little uninformed and you should stick to talking about technology. You should also try to factor in price when talking about technology, the market for performance at any cost is a small part of the market. But back to stocks, traditionally people buy stocks because they return cash to shareholders. For all of AMDs product success, they have not produced any excess cash flow for shareholders, in fact they have been value destroyers over their history. The current management is very good, but even with their current success the capital needs for a new fab and good people (need to pay the engineers) will continue to pressure free cash flow in 2006 and 2007. Their superior technology in NOR flash did not do them much good, despite being superior to floating gate technology and they sold it off at a bargain price through an IPO. Technology itself is important, but for the vast majority of people, price, form-factor, support, etc. are all equally important criteria. For all their great products in 2005 AMD could still not out-grow a much larger INTC (see iSuppli data for semiconductor revenue on 2005), in 2006 it will be tougher as INTC is unlikely to experience supply disruption again and their products will be better, perhaps not superior, but for 99% of people they are not going to care about arcane benchmarks. In case you didn't notice INTC picked up almost 6m units at MacWorld (Apple's expected unit shipments in 2006).
In today's downgrade, the analyst raised both Q4 earnings AND 2006 EPS estimates. WHAT!!! The downgrade before the break Stifel something-or-other (never heard of them) said pretty much the same thing...AMD is doing great and gaining share, but we must downgrade it. Currently, AMD has a forward PE in the 30 to 40 range, depending on what numbers for 2006 EPS you beleive. But this dork Ben Lynch thinks that AMD can earn $1.25 next year but has a price target of $26/share. That is a PE of 19. What!? For a company that is growing like crazy? Even if they can't take share from Intel, they will benefit from the raw IT forecast for this year. This guy is protecting his $1.6 billion in INTC position, that's all. Besides, I doubt that today's stock move had much to do with the price action. The stock is still firmly in the uptrend channel.
Aside from the finacials, I'll share a little story. I used to work for Compaq computer years ago when CPQ was #1 and DELL was gaining on them. CPQ saw DELL coming and I thought 'Who the hell is DELL? You mean that little direct marketing and catalog company? They don't even have presence in stores. (Remember, this was before online ordering became commonplace.) CPQ had this awesome channel and could really move inventory. Yet they were scared big-time over DELL...they even made these corny little spoof movies depicting CPQ as the starship Enterprise and DELL as some Klingon vessel. Ekhard Pfifer was gunning to become a $50-billion a year company. Ah, but he raped the company. His vision was focused so much on the Q-on-Q numbers that he forgot to innovate. My point is that the big guy can go down when he loses whatever edge that he posseses. It can happen to INTC and it really appears that it already did. I can only imagine the corny movies they must be playing at corporate communication meetings over at INTC about AMD!!
I started getting into PC tech when I was 4. As someone who has been very involved in PC trends all my life, you definately pick up on the concensious of most I know, and myself.
Hands down the best article you have produced. The December CPU guest contributer article was decently close though.
Your choice of topic was superlative, and the article was well written, insightful, and heart felt, even though it was towing the line on objectivity.
Now it is funny because you illustrate the x factor of markets - human emotion. Additionally, you bring to light something that bothers me. So many so called analysts and experts are nothing more than people who study an industry and really do not know much about it besides cursory review of raw data and reflective speculation.
Anyway, thanks for the good read. Post some hotties from CES for the lowbrow article.
It's always fun watching and seeing analysts with no clue about technology make predictions. They will look at past performance and ignore the reasons for that performance if they are even aware that there are REASONS for the market to go up or down.
My own predictions on AMD are that there will be a brief downturn in AMD stock, not just because of Ben Lynch, but because Intel just launched the Centrino Duo platform. It will take people some time to see how this affects AMD's overall performance.
People also don't understand that Intel getting the contract with Apple won't affect AMD sales in any way. Apple has their own system architecture, and you need to look at the Apple deal the way you would at the chips inside of cell phones. It's a different market, and you can't use that to say that AMD has lost traction because of the Intel-Apple deal. But, people who don't know will see the spike in Intel processor sales from the Apple-Intel deal and assume that's bad news for AMD. It's not.
So, AMD will dip a bit, then come back. Things may get a little more interesting in this area when Intel releases their Pentium-M derived desktop processors in the second half of 2006. By then most of us expect that AMD will have an answer to boost performance to keep their current performance lead, but the question is how much of a boost will it be. That's the real question for AMD going forward. AMD will still hold a lead, but will it be as large of a lead in processor performance? Will it matter now that so many people accept a non-Intel solution?
On the whole "Dell is Intel only" issue, it's going to be an interesting year in that regard too. As more and more companies adopt Opteron for their servers, they will start to accept that AMD based systems are a good choice, so will start to listen to the IT staff when they recomend something. These companies may break away from Dell as time goes on, especially considering how bad Dell support has gotten. What these people use at home will translate to their businesses. If your home computer has a problem and you talk to a tech in India and you arn't satisfied, you probably won't buy a Dell again, even if your next computer manufacturer has their tech support in India.
So, I'd wait until around Mid-February, by then the dip in AMD stock should be done and will go back up from there.
AMD NATION !!! Cometh. AMD is stronger than it has ever been. It went to the high 90's back when they introducted the Athlon. Now AMD is taking market share on all levels. The stock price will break $100 within one year. Profits being made hand over fist.
I think your comments are a little uninformed and you should stick to talking about technology.
Sir, I think the fact that I understand technology create informed comments.
You should also try to factor in price when talking about technology, the market for performance at any cost is a small part of the market.
Good point, perhaps I should have wrote that AMD is a "smarter" choice, because not only do they offer better performance, but they also offer a lower cost of ownership on desktop, server, and workstation. Their notebook offerings are young, but still quite strong.
But back to stocks, traditionally people buy stocks because they return cash to shareholders. For all of AMDs product success, they have not produced any excess cash flow for shareholders, in fact they have been value destroyers over their history.
Their current management has made history, they turned around a 30 year old company in a matter of months. They are already creating value.
The current management is very good, but even with their current success the capital needs for a new fab and good people (need to pay the engineers) will continue to pressure free cash flow in 2006 and 2007.
Yes, and their growth in server, workstation, desktop and notebook will continue to grow. ..and good people are already seeing success, just look at the stock trading.
Their superior technology in NOR flash did not do them much good, despite being superior to floating gate technology and they sold it off at a bargain price through an IPO.
They wanted their core to focus on building better platforms, I say they made the right move. Give it time and you'll see what I mean.
Technology itself is important, but for the vast majority of people, price, form-factor, support, etc. are all equally important criteria.
Yep, they are all equally important, so people want to make smarter buying decisions. You can't argue with me on this point: AMD is a smarter choice on desktop, server, and workstation. Intel has a strong notebook platform that's been on the shelves for a few years now. Turion 64 is still fairly new but starting to get its legs.
For all their great products in 2005 AMD could still not out-grow a much larger INTC (see iSuppli data for semiconductor revenue on 2005)
Hmmm, I saw it differently I guess. AMD owns the high end (high margin, high profile, high influence) market on desktop. Their server business is growing in leaps and bounds, and this year is going to be insane for their server business. I'm not trying to be arrogant, but I don't need to read iSuppli data to see this. I speak to key people in this industry everyday.
in 2006 it will be tougher as INTC is unlikely to experience supply disruption again and their products will be better,
Hmmm, you figure? We are beginning to see supply issues with Yonah platforms. Granted it's new, and Apple has committed to a large quantity, but it's not a good sign. Also, Intels launch plans for Conroe (including chip speeds and timeline) are a bit bullish...
perhaps not superior, but for 99% of people they are not going to care about arcane benchmarks.
You're right, 99% of people care about making SMART informed buying decisions, and as they do their research they will do so. With Apple it's another story, people buy Apple because they're Apple and they make fantastic PCs. No question Apple is going to have a great year.
In case you didn't notice INTC picked up almost 6m units at MacWorld (Apple's expected unit shipments in 2006).
Yep, I see Apple's business growing, without a doubt.
Hector should not be worried, as compared to days of yore in AMD - he can look in the mirror and say the firm is well managed. I have seen Hector from a distance when I worked at Motorola - he was and is unusually skilled in technical management - and a dilligent worker.
The challenge that recurrs at any firm is that typically upper management has difficulty telling what is real with respect to required CPU innovations to keep and gain leadership in performance.
It is hard to predict accurately even when you have a good feel for it, due to the sheer complexity...
Intel's achilles heel was in the "transition" to Itanium, there were apparently ( per a web site ) some "false" performance projections that misled those not properly trained in Processor Architecture / design ( in Sr. Management ).
This and subsequent compounded errors led to the Itanium debacle and the sad mis-focus of Intel resources away from X86.
YET Intel has huge bench depth for optimal design of excellent CPUs - it is NOTHING to trifle with when the right resources and MANAGEMENT SKILLS are brought to bear. Had Itanium been better managed, it might well have surprised a few folks today.
I contend that the newer generation Intel designs, forthcoming this year, will make things quite competitive for Intel again especially towards year end but possibly earlier. Not equal to AMD but possibly much faster than the best of AMD.
And years ago, when Athlon came out, I was very bullish on AMD CPU supremacy - the design weakness has been fixed that hindered AMD through the K6...
Case in point is that Yonah might have desktop potential and in desktop TDP one could hazard a guess it can be clocked to ~3Ghz on the 65nm process.
Well a 2Ghz Yonah in its std laptop power configuration - benched at much lower electrical power dissipation but equal CPU computational power to an AMD X2 4400 at comparable clock. Intel's is on 65nm, and AMD's on 90nm.
My guess is in desktop power form Yonah comes close to the best any AMD can do till their 65nm devices ship. And apparently this will not be a standard product....
And when 4 instruction issue CPUS from Intel come out on 65nm - Merom and Conroe - the game will go to Intel for the desktop, but the market momentum might not be so fast granted.
Estimates are that a 4 issue Intel CPU ( merom / controe/ woodcrest ) will have about a 20-30% performance advantage over AMDs 3 issue CPUs....dual core to dual core and single core to single core...
The changes this year at Intel will seem incremental, as there is yet to be a single product fielded YET from Intel which combines all the best stuff in one CPU product.
In the fall this will change, although Woodcrest ( Xeon ) is apparently coming earlier.
INTEL
65nm NOW in Volume
P3 derivative NOW with 32bit Yonah on 65nm
AMD
stuck on 90nm till when? ( clock tops out at a shade under 3 Ghz )
Fielding DDR2 in a couple of months for memory bandwidth
But the crowning feature for Intel will be the later 4 instruction Issue, P3 derivative CPUs - Merom and Conroe ( and Woodcrest? ) which will likely regain absolute performance in single and dual core CPUs. ( not high CPU count servers )
Single and dual desktop CPUs are the majority of the dollar volume market.
It is here where Hypertransport and Integrated memory Controllers might not have as much benefit as claimed ( ie there are alternatives that are less catchy phrases that can work just as well in SINGLE Package CPUS - ie not in multiple CPU Package Servers ).
Even still in small CPU Package Count Servers, non-HyperTransport can be made to work in dual and possibly 4 up with a less elegant method than HT.
Beyond 4 CPU Package Servers - there HT will hold court until Intel fields server CPUs with their verstion of comparable feature - the CSI ? common system interconnect... And yes in high CPU Package count servers / HPC - integrated memory controllers are of issue for cost and performance.
My take is that Intel will take back the desktop by the year end, UNLESS AMD succeeds in delivering volume 65nm parts.
I suspect that while AMD might not have a huge delay in 65nm, there is larger risk than in Intel's present path forward, as processes are always unknowns until proven otherwise.
Granted AMD's teaming with IBM mitigates some risk that if they were doing it solo, the odds would be much poorer.
But so far the IBM 65nm process is apparently not shipping commercially - is the word... ( I may be wrong but that is what it seems - with the cell processor on 90nm )
I think all in all, this coming year will be exciting for customers as there will be material advances in CPU performance from both major suppliers.
Great post. You're totally right, too. One oindividual said that the NOR flash....etc. The only reason they had a problem was because Intel was willing to lose money on their NAND business to keep AMD down.
As far as growth, the only thing missing is the HP\Compaq\Lenovo desktop business.
The HP585 server is in use on MSN and MSDN. Sun has revitalized Solaris using Opterons. Nvidia makes most of their money off of AMD systems. The success of ATIs Xpress200 has forced Intel to use it.
I will be investing heavily in AMD in the coming months. I'm typing this on an X2 4400+. With the intro of the FX60, I even have an upgrade path.
The new AM2 socket will have 333MHz HT and DDR2 up to 800MHz. With no CSI Intel has NO CHANCE. I mean the new 955 only allows them to say they aren't worse at idle than AMD is at load. They only picked up one or two wins in app tests. Wow, what an accomplishment.
And true if anything Dell will be knocking on Hector's door soon. Dell has nothing that can compete with a HP585 with Opteron 880s. And using only Intel, they won't get anything this year either.
Ben Lynch's statements are laughable and ruin his reputation as a analyst as well as Deutsche Bank's. By raising his wrong and 'too low' estimates he ADMITS he was WRONG about AMD's 4th quarter and ADMITS he is already WRONG on his estimates he had for 2006. He ADMITS he was wrong by 32% on the 4th quarter and 42% on his forecast for 2006....the evidence is in his own raising of his estimates.....translation: "I have been totally wrong estimating and analyzing how well AMD is doing and how well it will do in 2006" .. "BUT I (Ben Lynch) want you to listen to me and believe my analysis, when I tell you my predictions for this year and downgrade AMD to sell" .... hahahahahahahaha .... laughable!!!!
AMD is on the cusp of doing something that does not happen twice in a century; taking its rights place as a true #2 market presence in the world.....it will be the 'Pepsi' to Intel's 'Coca-Cola'-like dominance.
Wascoe
Just to be clear, I think Core Duo is a strong platform (with a lame name) - but it's no secret that Intel Centrino platforms are strong. So since Centrino Intel has always had a great notebook offering.
As I said, though, Turion 64 is very new, and it's had a great start. AMD should be proud of themselves for the early success they've realized from this processor.
Once new platforms start to show up we'll see some interesting comparisons.
Ben Lynch should actually be out of a job truth be told.
AMD investors need not worry about these analyst comments, considering that:
1. Uncertainty about AMD was greater a year ago, so why worry now?
2. Analysts are usually wrong (try following their buy/sell recommendations if you like losing money).
3. Analysts tend to have a myopic view of technology.
4. Analysts are like any other group of lemmings (did they see 2000 looming in the distance in the late 90's before going over the cliff?).
5. If analysts were good investors they wouldn't be analysts (what would they be?).
6. AMD makes good products (not just this or last year).
7. There is no certain way to make money!
Ben Lynch is supposed to be a stock analyst. Some people think that he makes his own calls on a stock, independent of the Company he works for. That would equate to the Press Secretary of a U.S. President saying whatever he feels about an issue, without following the lead of his boss, the President. Duetche Bank his employer owns 6 million shares of Intel, and Intels stock is racing in nuetral, flat to down, as AMD hits multi-year highs.
Could anybody believe for a minute, that Ben Lynch could be honest about AMD eating Intel's and still keep his job at Deutche Bank. No stock analyst makes the call on Buys and Sells for big houses. Their job is to provide spin for the guy who makes the Call, and risks the Companies money.
AMD started with 486 processors that where identical to INTEL< in that fit into same slot. Over 15 years slots changed, chipsets changed, memory changed, yet AMD keeps up in performance scores. Will AMD move to faster core or can it? Everything is in AMD favor, unless there stuck with slower memroy & core clock, theres no real stopping AMD now.Even "cell" from I.B.M., with its' much increased bit thruput, still has fantastic game cards to stand up against,one major player of game card top end "loves" AMD, thats NVIDIA. Peak quarter, I doubt it, yet....Signed:THOMAS STEWART VON DRASHEK M.D.
AMD migrated from time & charges in telco industry to 486 processors 15 years ago. At first both AMD & Intel where identical in slot interchangeability. Divergence of slot, basic design & mainboard support/chipset has made two slightly differnt solutions.If AMD migrates to higher core clock, AMD will keep up performance with less redundency. INTELS big play is 333 mhz/sec core clock coming fall '6. I.B.M. "cell" will outshine them all with faster bit thruput (8X to 10X more). Yet INTEL & AMD will get to same point in 3 years. However, top end game carder & chipset designed: NVIDIA, favors AMD & even "cell" will have to run for its' money against strong top end machines of AMD packed with top end NVIDIA card(s). AMD peak quarter? I think not, unless AMD is not holding back on technological improvements & simply has shot its' wad.OPPS-THOUGHT FIRST POST WAS "BUST", YET, HERES SAME IDEA AGAIN.SORRY.::Signed:PHYSICIAN THOMAS STEWART VON DRASHEK M.D.
All Wall Street Analysts are crooks. I exposed Ben Lynch here at :
http://sharikou.blogspot.com
AMD has a minimum of 5 year lead over INTEL on archictecture. The Dempsey is no more than an imitation of Athlon MP (2001). Core Duo is 1995 32 bit Pentium Pro. INTEL's P4 Xeons run slower under 64 bit mode than 32 bit mode. AMD will enjoy 100% of 64 bit mobile market for another 9 months, as INTEL merom is not expected until Q4 2006. Desktop wise, INTEL is fragged and will be fragged...
I think AMD has some cause to worry, because Intel has it's 65nm up and running. OTOH, the performance level of the Intel 65nm's may not start to really upstage AMD until the end of the year. The AMD processors coming out in the 2nd quarter should be able to hang tough with Intel. I have a hard time believing Apple is going to do much for Intel and vice versa.
No question though, the absolute superiority that AMD had over Intel in 2005 will not be the case this year, but 2005 was an amazing anomaly for AMD, it is just not normal to dominate Intel that way, you knew Intel would respond.
I think the real action will be in 2007, and IBM as a shadow partner with AMD will come more into play in the technological offerings of AMD at that time.
Great article! But you forgot to mention that AMD will be able to produce 3x as many of processors then in 2005 when FAB36 comes online. And on top of that they have a deal with Chartered Semiconductor to produce processors.
Micheal Dell's supply worries should be a thing of the past.
Even if AMD wouldn't have the performance lead, they would still have great processors and would be able to bring them to the market in big volume and thus still create value for the shareholders!
Arcane Benchmarks - hmm Overclockers love them and gammers die for them. Im kind of in there. It seems like a nice market. We are in love with AMD for a host of reasons and we buy them often. Intc is the Chevy in this market.Bought 500 shares of amd at around 18 ahh think I will take another look at that FX60 - sweet.
I have just seen Intel's server CPU roadmap, and it looks good on paper.
However, they tend to compare their "best hopes" for their future offerings against silicon that AMD is currently shipping, and underestimate what AMD will put on the street.
If they execute flawlessly, they will perhaps catch up to AMD by 2008 in terms of performance per watt (but who knows what the system price will be.) Hypertransport takes a whole lot of chipset costs out of the equation for system builders, and allows the savviest of engineers to leverage that technology out to I/O.
Most people seem to live by inertia and assume Intel will alwas prevail because they always have. These people probably lost some money on Word Pefect, Novell, and Lotus for the same reason.
The mighty have fallen before.
Excellent article, excellent points, and overall, a refreshing change from the uninformed comments of stock analysts. It's nice to have someone informed about technology be so vocal and point out severe inconsistencies in stock analysts interpretations.
Well, you were right all along! INTC and AMD reported earnings and it's clear that AMD is on a roll:
Financial Times
By Chris Nuttall in San Francisco
Thursday, January 19, 2006
Concerns this week about the PC industry turned in a day to perplexity over bellwether stock Intel (NASDAQ:INTC) . On Tuesday, the longtime leader in the microprocessor market missed its numbers, blaming in part falling demand for desktop computers. But on Wednesday, results from smaller rival Advanced Micro Devices (NYSE:AMD) beat analysts' wildest expectations.
"We have been surprised – blown away is more like it – by the extent of the company's gains," said Merrill Lynch, as AMD reported that fourth-quarter sales of its microprocessors grew 35 per cent over the previous quarter and earnings per share reached 45 cents – well ahead of consensus estimates of 25 cents.
GO AMD GO!!!
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