AMD reports much smaller loss and Intel profits up 12 percent for Q3

AMD has once again reported a quarterly loss, but a significantly reduced one. Its net loss of $67 million is a big improvement on losses of $396 in Q3 '07 and of $1,189 in Q2 '08. The loss of 11 cents per share compares very favourably to reported analyst expectations of a loss of 40 cents per share.

In what is generally being recognised as a good performance by the processor maker, revenue from this quarter was $1.558 billion, a 15 percent increase on the previous quarter's revenue of $1.349 billion. Gross margin also improved to 51 percent (45 percent if you exclude process technology license revenue), compared to 37 percent in the previous quarter and 41 percent in Q3 '07.

The deal to form The Foundry Company and the two billion dollars or so that AMD will initially gain from it are not included in these results. Referring to the deal Dirk Meyer, AMD's president and CEO, said: "AMD will be assured access to leading-edge manufacturing processes without the obligation to make the capital investment required to maintain a world-class manufacturing operation. We look forward to the successful closing of this joint venture early in 2009."

Robert J. Rivet, AMD's CFO, said: "We are pleased to have reached our goal of operational profitability this quarter while increasing gross margin to 51 percent."$108 million of AMD's losses came from "discontinued operations".

"Improved execution across all of our businesses was punctuated by a refresh of our graphics product line-up, driving 55 percent sequential revenue growth and market share gains. In addition, customer adoption of our quad-core microprocessors was strong, with unit shipments increasing 46 percent sequentially."

Crisis, what crisis?

Intel provided welcome relief from all the talk of financial apocalypse and beat estimates with a 12 percent increase in its third quarter profits, totalling a cool two billion dollars.

$10.2 billion in revenue was only one percent up on the same quarter last year, but that was still enough for it to set a new record for Q3 and yielded a 44 percent rise in operating income to $3.1 billion.

"As we look to Q4, it's hard to know what impact the financial crisis will have on end customer demand," said Intel CEO Paul Otellini. "We are confident that our own product portfolio, strong cash flow, commitment to deploying new technology and market momentum will allow us to outpace peer companies at a time when business levels are difficult to predict."

Among the highlights of Intel's quarter were sales of Atom processors and chipsets, which totalled around $200 million, but this led to a lower average selling price. Intel forecast revenue of between $10.1 and $10.9 billion for Q4.
source

Intel patent attorneys kick some dirt at AMD

AMD's breakup into two separate companies is certain to have wide-ranging impact in the industry, and unsurprisingly, Intel's among the first to react -- it's warning that it has "serious questions about this transaction" as it relates to its patent cross-licensing agreement with AMD and that it'll "vigorously protect" its intellectual property rights. That's about as aggro a patent attorney can get without coming to your house and peeing on the lawn , so we'll see how this shakes out -- for its part, AMD says that it's taken the deal into account, and that it'll "continue respecting Intel's intellectual property rights, just as we expect them to respect ours."


While Intel has expressed concerns over the recently-announced spin off of AMD's manufacturing assets, the Athlon and Phenom maker has stepped up to say it believes there's nothing to worry about. According to Intel, the spin off deal may result in a violation of its patents through the breaking of the cross-licensing agreement signed by the two chip companies.

In response, AMD stated that their move won't lead to any patent issues and will respect Intel's IP (Intellectual Property). That surely isn't enough for Intel so expect a bit more drama coming out of this.

AMD giants target intel

Analyst Opinion - AMD was in significant trouble: Up against a vastly larger and better funded competitor, the company was increasingly outmatched in recent months. This is because it has simply become too expensive to keep up the technology race. Sony, Texas Instruments, and Freescale had to exit the microprocessor segment, because the costs of staying in remained too great. This massive drop in competitors put AMD on a very ugly list and created a situation where it seemed that only one vendor could be driving the market in future and limit the amount innovation in a quickly changing, critical market.

Advantages

One of the big advantages of the new fabrication entity is that it won’t be public, which means that the costs typically associated with a public company like Intel and AMD won’t be incurred by this new entity. These costs aren’t trivial and have been one of the big drivers that took a number of companies private over the last several years. They are also huge distractions that can also substantially inhibit a company’s ability to execute.

In addition, because the fabrication company doesn’t have to please financial analysts or investors, it doesn’t have to worry about quarter to quarter performance and can invest strategically. This means, if it needs to, in order to gain a competitive advantage in say five years, it can invest to that goal and operate in the red to get there. A public company like Intel can’t do this because their investors won’t allow it, giving the fabrication company a potentially significant advantage.


Making it work

In effect, what is created is a more independent manufacturing entity that will be free to seek business from others. For instance, IBM is likely also not that interested in maintaining this technology race in fabrication and will likely find this new entity an ideal alternative for the firm’s own fabrication capability and risk a new plant would entail.

As this ramps up, the new foundry company should be able to gain additional economies of scale driving the overall cost of the manufactured product down. In addition, the funding source for this company does not come from traditional lenders, which have become vastly more difficult to work with in recent weeks. This strategy gives AMD the capability to build a New York fabrication facility and expand the Dresden campus in Germany with a new 300 mm facility.

This last, given current conditions, could deliver significant PR benefits and give AMD substantive political support which should pay additional dividends.

Risks

Typically, if you split a company in two parts in this way, there are significant risks. What if the foundry goes under or is bought by someone like Intel for instance? These risks appear to be mitigated by the folks doing the funding as they are investing heavily in both the new foundry company and AMD. In addition, the investors are operating under a long term strategy that anticipates their need for sustainable income after the oil Industry collapses which, by most projections, isn’t that far off.



Wrapping up

As a result of the deal, AMD has far fewer capital assets to manage and can focus more on the future rather than trying to dig the company out from the financial decisions of the past. AMD will also have approximately $2 billion in additional reserves and a vastly lower breakeven point. Finally, AMD will have an investor willing to step in, if required.
source:tgdaily.com

Intel's '09 Roadmap Revealed, Part 1

Trying to decide what your next upgrade is going to be, and when you plan on doing it? Well how about a little information that could help you decide.

Intel's 2009 Roadmap

Bloomfield Processor Features : Based on next generation Nehalem architecture - Intel Turbo Boost Techonology* - Intel 8MB Smart Cache - Octo(8) Intel Hyper-Threading across four cores - Integrated Memory Controller – 3 channel DDR3 http://en.wikipedia.org/wiki/DDR3_SDRAM - Intel QuickPath Interconnect to the X58 Express Chipset - PCI Express 2.0 discrete graphics for multi-card performance (2x16 or 4x8) ATI or Nvidia http://en.wikipedia.org/wiki/Nvidia - Seven new SSE4 instruction sets - Available in 2.66GHz , 2.93GHz and Extreme Edition 3.2GHz - LGA-1366 Socket Interface - Release starts late Q4-08

Lynnfield Processor: Based on next generation Nehalem architecture - Intel Turbo Boost Technology* - Octo(8) Intel Hyper-Threading across four cores - 8MB of Intel Smart Cache - Integrated Memory Controller – 2 channel DDR3 - PCI Express 2.0 discrete graphics for single or multicard performance (1x16 or 2x8) ATI or Nvidia - LGA-1366 Socket Interface - Release starts early Q3-09

Havendale Processor: Based on next generation Nehalem architecture - Intel Turbo Boost Technology* - Quad Intel Hyper-Threading across two cores - 4MB Intel Smart Cache - Integrated Memory Controller – 2 channel DDR3 - Integrated graphics or Discrete graphics support for single card performance (1x16) Nvidia or ATI - LGA-1366 Socket Interface - Release starts early Q3-09

Clarksfield Processor: Based on next generation Nahalem architecture - Octo(8) Intel Hyper-Threading technology on four cores - Intel Turbo Boost Technology* - Up to 8MB of Intel Smart Cache - Integrated Memory Controller – 2 channel DDR3 - Discrete Graphics Support for single or multi card performance (1x16 or 2x8) – Releases in late Q3-09

Auburndale Processor: Based on next generation Nehalem architecture - Quad Intel Hyper-Threading technology on two cores - Intel Turbo Boost Technology - Integrated Memory Controller – 2 channel DDR3 - Integrated Graphics or Discrete Graphics Support for single card performance (1x16) – Releases in late Q3-09

Intel Turbo Boost Technology: Intel Turbo Boost Technology dynamically increases or decreases processor performance based on demand from applications. Dynamically increases clock frequency based on available TDP headroom.

Intel Desktop Processors 2009

Bloomfield , Lynnfield , Havendale

Processor	Clock	Cache	Memory	TDP	Socket	Cores	Architecture	Price
Bloomfield XE	3.20GHz	8MB	1066/ 800	130W	LGA-1366	4/8	45nm	$999
Bloomfield P1	2.93GHz	8MB	1066/ 800	130W	LGA-1366	4/8	45nm	$562
Bloomfield MS3	2.66GHz	8MB	1066/ 800	130W	LGA-1366	4/8	45nm	$284
Lynnfield	TBD	TBD	TBD	TBD	TBD	TBD	45nm	TBD
Havendale	TBD	TBD	TBD	TBD	TBD	TBD	45nm	TBD

Intel Workstation & Server Processors 2009

(Xeon)Tylersburg

Processor	Speed	Cache	TDP	Memory	Sockets	Platform	Price
W5580	3.20GHz	8MB	130W	1333MHz	2	Workstation	$1600
X5570	2.93GHz	8MB	95W	1333MHz	2	Server	$1386
X5560	2.80GHz	8MB	95W	1333MHz	2	Server	$1172
X5550	2.66GHz	8MB	95W	1333MHz	2	Server	$958
E5540	2.53GHz	8MB	80W	1066MHz	2	Server	$744
E5530	2.40GHz	8MB	80W	1066MHz	2	Server	$530
E5520	2.26GHz	8MB	80W	1066MHz	2	Server	$373
E5506	2.13GHz	4MB	80W	800MHz	2	Server	$266
E5504	2.00GHz	4MB	80W	800MHz	2	Server	$224
E5502	1.86GHz	4MB	80W	800MHz	2	Server	$188
L5520	2.26GHz	4MB	60W	1066MHz	2	Server	$530
L5506	2.13GHz	4MB	60W	800MHz	2	Server	$423
W3570	3.20GHz	8MB	130W	1333MHz	1	Workstation	$999
W3540	2.93GHz	8MB	130W	1066MHz	1	Workstation	$562
W3520	2.66GHz	8MB	130W	1066MHz	1	Workstation	$284

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