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  • steveyballmer - Friday, July 25, 2008 - link

    Duh! They support Vista!">
  • Barack Obama - Tuesday, July 22, 2008 - link

    I love these 'business of tech' articles. Keep em coming! Reply
  • brxndxn - Monday, July 21, 2008 - link

    For the EU investigation part...

    This is not because AMD is having trouble competing now - it is because AMD had trouble competing even when they had a vastly superior product. During that time, Intel kept AMD from even being a supplier to some of the world's largest computer makers. They did this by manipulating prices in their 80% share so that AMD would effectively need to charge less than zero for their processors. AMD even tried to give away processors to HP - and HP, because of agreements with Intel, could not take all of them.

    Here's the math: Suppose you need 1million processors. AMD's are priced at $80 each. Intel's (at the time, slower) are priced at $100 each. But AMD, is unable to supply more than 50% of your required processors - so you are forced to deal with Intel. Now, Intel offers either 800,000 processors at $100 each.. or 900,000 processors at $90 each or 1,000,000 processors at $80 each. In this situation - that actually did happen while AMD had the better processor - AMD cannot compete at any price.

    Now, Intel fanboys say there is no merit to AMD's claims and say AMD simply cannot compete - even though for nearly four years, AMD crushed Intel in processor performance. If AMD was allowed to compete fairly, AMD would have had a LOT more money to continue putting into R&D - and maybe their processors today would still be crushing Intel.

    In this duopoly, it is clear that Intel was monopolistic when it could not beat AMD in performance.

    Oh ya.. for the Core today, Intel had to take massive losses to put billions of dollars into R&D - something AMD cannot afford to do now.
  • BLaber - Monday, July 21, 2008 - link

    I hope there is a way in which AMD can use the EU invetsigation and other such investigation findings to sue int-hell for their wrong doing.. Reply
  • Viditor - Sunday, July 20, 2008 - link

    "there is some continuing concern from outsiders that the entire situation is being unfairly influenced due to AMD’s fabs being located within Germany"

    While that can't be proven either way, the fact that Korea, Japan, New York, and the FTC have all either accused Intel of the same thing the EU has, or are investigating them for it, tends to give the impression that it's probably not a biased prosecution.
  • tinyfusion - Saturday, July 19, 2008 - link


    You paint a better picture for AMD because you don't understand how the $143 mil operating loss is calculated. If you have a chance to read through the transcript available at, you will see their gross margin is inflated from 38% to 52% due to one time incoming from the sale of some 200 mm tools. Their actual operating loss is much higher than your number,

    some quotes from AMD's CFO:
    "Losses from continuing operations were $269 million or $0.44 per share which included a net favorable impact of $97 million or $0.16 per share. This favorable impact consists of a gain of $193 million from the sale of 200 mm Tools partially offset by $96 million in charges. Our loss from discontinued operations was $920 million or $1.52 per share. This was largely made up of non-cash goodwill and intangible asset impairment charges of $876 million.

    Reported second quarter operating loss is $143 million but on a non-GAAP basis was $276 million compared with $185 million last quarter. For comparability I have excluded the Tool sales, arc and restructuring charges as are outlined on the table in our press release.

    Gross margin in the quarter was 52% including a 14 percentage point positive impact associated with the sale of 200 mm Equipment. Therefore gross margin was 37% compared with 41% in the prior quarter. This decline was due to lower unit volumes and ASP’s and changes in product mix as we sold older generation products to make way for our new offerings.

    Now switching to the business segments. Computing solutions revenue was $1.1 billion in the second quarter, down 8% from the prior quarter and flat compared to the same period a year ago primarily due to weaker sales. The server business saw 5% unit growth over the prior quarter and a 19% increase over the same period a year ago, a positive sign in light of the recently launched OEM products. Quad-Core and Triple Core processor shipments were up significantly while microprocessor ASPs were down. The result of sales of older generation products.

    Operating loss for the computing solutions group was $9 million; however this includes a $192 million gain from 200 mm Tool sales. In the graphics segment which now includes game console royalties revenue for the quarter was $248 million, down 5% sequentially and up 18% year-over-year. Operating loss for the graphics segment was $38 million in a very competitive pricing environment particularly on our older generation products. However, our new highly acclaimed HD4800 series has been well received in the market since its launch in late June"
  • alexwgreen - Wednesday, July 23, 2008 - link

    "Reported second quarter operating loss is $143 million but on a non-GAAP basis was $276 million compared with $185 million last quarter. For comparability I have excluded the Tool sales, arc and restructuring charges as are outlined on the table in our press release."

    I must agree and support what Tinyfusion has said here.

    Here is a useful definition of Operating profit

    "Income or loss before taxes and extraordinary items resulting from transactions other than those in the normal course of business."

    Clearly, the sale of equipment and the impairment of goodwill associated with the purchase of ATI are NOT part of AMD's normal course of business. (I suppose that actually depends on who you're asking, but in terms of accounting standards anyway.)

    In other words, they can't keep selling fab equipment because they only have so much to sell. And including the sale of such equipment, and any other one time transactions in operating profit/loss will give you a figure which does not reflect the performance of the company with respect of its normal operations, ie selling chips. And that is the crux of it. Performance is down on Q2 last year, and down on forecasts. Neither are good things. Spinning it any other way is just that, spin.
  • rudolphna - Friday, July 18, 2008 - link

    I love AMD, call me a fanboy if you wish. I tend to root for the underdog (ATi, AMD) So Intel's troubles come across as good news to me. AMD makes good processors, the majority of the population would be plenty happy with an Athlon64 X2 or a Phenom X3 in their desktop PC. My next computer (currently running an old 3Ghz Pentium 4 Prescott 2M due to funds or lack therof-) will likely feature a Athlon64 X2 +5000 or a Phenom X3 8450. I sure hope Anand is right and AMD will be profitable by the 4th quarter. I dont know how much longer can survive losing money like this. No competition for Intel is NOT a good thing, no matter what the fanboys say. When intel has no competitor, why should they spend money on R&D to improve when they could just use what they have now when it works just fine. Not good at all. Reply
  • ComatoseDelirium - Friday, July 18, 2008 - link

    Is their any chance AMD might get some cash if the lawsuit sours for Intel?

    Any speculation on how things might change?
  • Ryan Smith - Friday, July 18, 2008 - link

    Yes, but not any time soon. Intel first needs to be found guilty before AMD can start suing them for anything, and I'm not immediately sure what AMD would sue them on. My understanding of EU laws isn't great, but I don't believe any of the money from their fines goes to the harmed companies. Reply
  • Blackmarket - Saturday, July 19, 2008 - link

    Yes, that's right. Intel has to pay the money to the European Union. AMD has no direct benfits. Reply
  • lifeblood - Monday, July 21, 2008 - link

    But does that clear the way for AMD to sue Intel directly using the EU ruling as evidence for harm? I understand the EU fine is for harm done to the EU consumer, but if it's true then AMD has also been harmed. Reply
  • Pok3R - Friday, July 18, 2008 - link

    Good news then!

    ¿What about Nvidia? I must ask...!

    Great job, thanks.
  • Ryan Smith - Friday, July 18, 2008 - link

    NVIDIA doesn't report their numbers for a couple more weeks, their quarter ends slightly later than everyone else. Reply

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