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AMD Revenue Falls Amid Intel Pressure

By Ed Oswald, BetaNews

July 7, 2006, 11:57 AM

AMD disclosed Thursday night that it expected to miss its revenue targets, a sign that Intel's moves to counter AMD's recent gains with lower prices may be having an effect. For the quarter, the company is expecting to post $1.21 billion in revenue, down nine percent from the first quarter.

In its first quarter results, AMD said it expected revenue to be flat or slightly down in the second quarter. Analysts agreed, expecting $1.3 billion in revenue. However, some feared that Intel's deep price cuts in early June might have hurt AMD's bottom line.

Sure enough, the categories where Intel dropped prices are where AMD's sales were weaker. "Sales of entry-level and mainstream mobile and desktop processors were down," the company said in a statement. But the lower sales figures could also be due to a slowing in the PC industry overall, some say.

In addition, the second quarter is traditionally the slowest quarter. Thus, Intel's price cuts may have been more of a compounding factor in AMD's worse than expected performance rather than the sole reason.

Even with its troubles in the consumer side of the business, AMD's single-, dual- and multi-socket Opteron processors continued to see strong demand, setting a record.

AMD was not commenting on the second quarter results ahead of their release on July 20.

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By Crand3

posted Jul 10, 2006 - 11:10 AM

AMD this, Intel that. No matter where you stand, you have to look at what AMD did to Intel and what Intel's reaction to that is. The redesign their products to be more in-line with AMD's performance (although not there yet) and stay profitable by selling off their communications division. They are getting ready to flex some muscle here and I have a feeling that the Core 2 Duo is only the first shot across AMD's bow.

Score: 0

By bourgeoisdude

posted Jul 7, 2006 - 2:20 PM

It will go up and down, it'll have seasonal trends--but where will AMD be in 3 years compared to now? That is the question--and a question that I am currently unable to answer. The balance could tip either way at this point, I believe. If Intel keeps up this type of solid, consistent and aggresive competition, AMD will eventually make mistakes. If Intel does not, and AMD leaps forward with a radical new processor core architecture, Intel's in for a long, hard, uphill struggle.

Score: 0

By PC_Tool

posted Jul 8, 2006 - 1:32 PM

When will there be peace on Earth?

That is the question--and a question that I am currently unable to answer.

Who cares about AMD?

(sorry, feeling a bit 'hippy' today.)

*grin*

Score: 0

By Mark Gillespie

posted Jul 8, 2006 - 5:12 AM

The party is officially over at AMD. They have no new designs on their roadmap until late 2008, and they best they currently have to offer in the desktop arena (FX62), is being beaten easilly by the new Core Duo 2 chips.

Intel have quad core on the roadmap for next year. The sleeping dog has finally woken, and is unhappy their marketshare has dropped from 90% down to 82%...

Score: 0

By spongy-poo

edited Jul 9, 2006 - 12:38 PM

So far, nothing has come out of Intel but some well controlled benchmarks and a lot of hot air. That's been going on since the "P5" days, so I'll wait and see if they actually produce something. Until then, AMD products are on the street and working just fine.

Score: 0

By Galway

posted Jul 9, 2006 - 11:10 AM

They have 4 core processors to fall back on, they allready have working 4 core chips in operation. If they cant compete with the cores design, then they will just shove more cores per processor.

I must admit to looking forward to the new intel, I have had AMD for a few years now and hope to see intel be more customer friendly :P

Score: 0

By aredo

posted Jul 8, 2006 - 1:59 PM

I expect to see Sony/IBM Cell being the next major threat to Intel Centrino renewed architectures in the next few years if Sony/IBM will ever decide to enter the desktop market with not just the PS3 but directly instead.
Cell is known to be used in server/rack class products, direct competition to Intel Itanium, Sun CPUs, AMD Opteron and IBM own Power ones.

Score: 0

By Mark Gillespie

posted Jul 8, 2006 - 3:57 PM

Indeed, I have seen some mathmatical benchamrks from a US scientific evaluation, and it trouces a AMD Opertron by a factor of 30. yes 30 times quicker on some types of calculations. It also trounces a 2005 model Cray. Cell has some serious computational power. I am not sure how the will translate into mainstream applications...

Score: 0

By Grazer

posted Jul 10, 2006 - 2:58 PM

Source?

I am betting those were very specialized calculations. I have seen analysis of the Cell that indicates it will suffer greatly in branchy code.

Score: 0

By mjm01010101

posted Jul 9, 2006 - 8:44 AM

It won't, because neither IBM nor Sony want that market. IBM wants out of the hardware business pretty much, but it's so profitable right now for them with these geniuses keep producing these chips, and sony doesn't have very good marketing execution of late.