I think people underestimate AMD/ATI. The success of Nvidia's 8000-series against ATI's 2000 and 3000 series overshadowed the fact that during that time, ATI consoles were far outselling Nvidia consoles. ATI is now again on top in the value market with their 4000 series (causing much grief to Nvidia's aging 8000/then 9000/now 100/250 series).
Sure, AMD lost the CPU power crown back to Intel (and the small amount of market share that went with it), but with the spin-off of the Foundry, and positive success of the Phenom II, I see the company as a whole doing better in the years to come. They did eat some debt buying ATI, but with big hits like the Wii and 360, it should pay off in the end. Just as long as AMD doesn't suffer for Intel's whining about the CPU market cooling off.