Intel's Profit Drops 57%

[Action_Man]

If he lost the bet he wouldn't leave, sigh.

 

[xen]

Two things to point out.

1) This isn't a surprise. Intel actually met their projections for this Quarter (adjusted from Q1). AMD is having a huge price cut on July 24th to compete with the new Core 2 products. All of those price cuts have a HUGE affect on ASP, and decreasing volume will also hurt AMDs margins. AMD will pull through this, but not without cost. Unlike Intel they don't have the ability to simply plow through "rough" times and maintain a steady level of spending on R&D. Intel just released 5 new processors in a short time period and refreshed their entire product line. AMD can't do that. Sorry BM

2) It's hilarious that you guys are talking about Intel burning up money when they still make huge profits in comparison to 90% of all other companies in the world. Sure they only made around 1 billion dollars this quarter, but it's not like they are burning through money.

 

[bixplus]

If he lost the bet he wouldn't leave, sigh.

I know, no honor to be found in him. But that was to be expected.

 

[bixplus]

Two things to point out.

1) This isn't a surprise. Intel actually met their projections for this Quarter (adjusted from Q1). AMD is having a huge price cut on July 24th to compete with the new Core 2 products. All of those price cuts have a HUGE affect on ASP, and decreasing volume will also hurt AMDs margins. AMD will pull through this, but not without cost. Unlike Intel they don't have the ability to simply plow through "rough" times and maintain a steady level of spending on R&D. Intel just released 5 new processors in a short time period and refreshed their entire product line. AMD can't do that. Sorry BM

You've made some really good points here. Intel has made their projections, which was in serious doubt my many...myself included. By contrast, we already know that AMD will not make theirs. So, even if they are a few million shy of their projections, the ripple affect in the investment segment will be expontially worse.

I thought it was very curious as to why AMD gave us an update just a couple of short weeks before the final announcement. This typically is done when some bigger news is coming, and it ain't good. I wouldn't be too terribly surprised if they report a loss...all things considered. Pure speculation though.

 

[exit2dos]

If Microsoft announces another Vista delay in Q3, I think both AMD and Intel will have to lower projections. This could cripple AMD's stock price. Intel's value may not suffer as much since they currently have momentum and publicity which seems to be the biggest factor to individual investors. (Funds, in general, seem to focus more on P&L and history.)

 

[allhell]

With this & more in the pocket,

http://www.reghardware.co.uk/2006/07/19/merrill_amd_dell/

AMD has little to worry about right now & will enjoy good & sustained sales even with their limited fab capacitiy & price cuts.

Their profits will be lower but they dont have the inventory management HEADACHE that intel has form OVER SUPPLY of the crappy netburst cpus.
I wonder if intel ever heard of dumping?

I just dont see intel picking up any serious momentum in the near future despite the apparently good products they will release. The buying public just does not react that fast.

 

[dt]

im all happy with both amd and intel. intel pulled the core 2 out fast ( though its still not out yet)

amd should be ashamed of themselves, selling a processor fx 60 for 1000 bucks and people actually bought it lol. but that was only because intel didnt have nothing to show for once again. until now.


amd is like damn they actually pulled something out that is not shit... hmm... we gotta find a way to make are products not shit either. aka lowering prices


just think of life without intel or amd ( one either going bankrupt or something). if one dies then we will all suffer by getting processors by one company and have no choices of anything else ( besides high costing mac's... and only god knows why people use macs )

 

[chewbenator]

If P4 does liquidate in line with Intel's 50% number by Q1, they will have an ASP that will HeatBurst every house in No America at $40 Dell.

I am totally boggled by this sentence.

Has anyone looked at the quad core in Q4 article, perhaps that could shed some more light into the mudhole that is AMD vs. Intel.

 

[RichPLS]

the numbers are roughly true, with hins of sarcasm

 

[GloriosoSLB]

Man I think you are about to leave and Baron will stay. And take Spud with you.
That’s cool because he is one of few that post good things here.

We are planning for revenue in the third quarter to be between $8.3 billion and $8.9 billion, an increase of approximately 7.5%, in line with seasonal patterns.

Then, relative to Q4, to Glen's point, there are scenarios that Q4 is down again. If it was cost in Q3, wouldn't that improve as we went through to Q4?

Going into the third quarter, I would expect profits to be about flat.

So overall, expect a little increase in the third quarter, but I do not think it is a big increase.

Second question, as I look at the timing and the mix of your ramp, it seems to me like an awful lot of this inventory addition has got to be dual-core Pentium D, right?

Some of it is, yes. There was an increase in inventory of that product.

Read it here:
http://seekingalpha.com/article/13895

Read some of the Q&A. Intel is full of inventory. They made wrong predictions. Now I fully understand Dell going AMD.

 

[Action_Man]

You're quite the funny fella.

 

[allhell]

With the take over of ATI I think AMD has something big coming out both soon & down the road & thats why DELL went with them & not because of what they did in the past 3 years alone.

Companies like DELL MS IBM HP Have a serious inside track to both Intel's & AMD's roadmaps that are not available to the public.
What is available to the public is only for show & really makes very little difference to the real picture in their respective R&D departments.

Think of all the changes to the roadmaps that have happened, how many products that have been scrapped or derailed or suffered a premature death.

This type of technology is highly volatile & dynamic & both AMD & Intel have to be on their toes ,,, & that is good for us like you said.

Both companies always have a rabbit in the hat somewhere,, of that i'm sure,,just you wait & see.

But sadly think Intel will not regain all of the lost market share, only some & they will have to learn to live with that.
Intel snooooooze Intel looooose.

 

[nategarst]

Can we all smell the money burning?

Transition always costs money, we all knew they would have lower than expected revenue for this quarter so what’s the big surprise that its official, furthermore they are still yet profitable.

Thx for the spin, doctor. I told you this would happen. Q3 will be just the same.

BM proves the Infinite Monkey Theorem

Never heard of that theory. Thanks. Starting my day out right.

 

[BaronMatrix]

If he lost the bet he wouldn't leave, sigh.

I know, no honor to be found in him. But that was to be expected.

At least I don't sound like a cackling little girl. Do you think I have a notification on? Maybe I was out looking for a new janitorial position?

I only bet money. This isn't truth or dare.

 

[bixplus]

If he lost the bet he wouldn't leave, sigh.

I know, no honor to be found in him. But that was to be expected.

At least I don't sound like a cackling little girl. Do you think I have a notification on? Maybe I was out looking for a new janitorial position?

I only bet money. This isn't truth or dare.

Taking the easy way out(excuses)? Again, figured.

Oh, and if I'm sounding like a cackling little girl, you just got bested by someone who sounds like a cackling little girl. How does that make you feel?

 

[GloriosoSLB]

No.

You are the best of them all.

 

[oldsaw]

A few years ago some Englishmen actually staged such an experiment with real chimpanzees and real computers. The monkeys, it seems, chose overwhelmingly to poopoo and peepee on the keyboards, thus expressing a view of computers shared by not too few homines sapientes.

 

[49ers540]

I told you this would happen. Q3 will be just the same.

lol...I'm going to save this post of yours and will repost it after the Q3 results. Care to place a wager now?

How about this. If you're right, I'll leave THG and never post here again. However, if you're wrong, you leave and never post here again. Deal?

Time to put up, or shut up.

I'll bet you $10. Now what we are talking about is year-on-year. With Core 2 ramping it may push up prices and leave a glut of P4s. If OEMs have a "can't sell it" deal, it maybe bad. If P4 does liquidate in line with Intel's 50% number by Q1, they will have an ASP that will HeatBurst every house in No America at $40 Dell.

Sempron has been AMDs biggest retail seller (check out Best Buy) so they will still gain share while saving money on 1MB retail chips.

X2 3600+ will be here soon and will start to replace Sempron with the big DualCore, double speed DDR sign for pennies more.

Single core has been cancelled. This will limit the amount of masks needed and separate runs necessary. Fab36 has good capacity - I believe the number was about 2,000 wafers per month at 65nm - currently. It is set to ramp to 50% 65nm Q107.

WIth ALL X2 going to 65nm cost-savings for the next few quarters will make up alot of ground in the midrange market. With Dell supposedly set to announce a larger deal after quarterly it will mean a lot of 65nm can go to them with the business platform. I for one will be glad to get rid of the OptiCraps I have to dev with. Whether it's AM2 or Core 2.

Anyway, AMD seems pretty well prepared to make some money this year.

Sempron is absolute crap. I don't know how many of my friends complain about Sempron being an absolute dog.

 

[VillageIdiot]

Now I fully understand Dell going AMD.

Holy $hit! It talks!

 

[spud]

Man I think you are about to leave and Baron will stay. And take Spud with you.
That’s cool because he is one of few that post good things here.

We are planning for revenue in the third quarter to be between $8.3 billion and $8.9 billion, an increase of approximately 7.5%, in line with seasonal patterns.

Then, relative to Q4, to Glen's point, there are scenarios that Q4 is down again. If it was cost in Q3, wouldn't that improve as we went through to Q4?

Going into the third quarter, I would expect profits to be about flat.

So overall, expect a little increase in the third quarter, but I do not think it is a big increase.

Second question, as I look at the timing and the mix of your ramp, it seems to me like an awful lot of this inventory addition has got to be dual-core Pentium D, right?

Some of it is, yes. There was an increase in inventory of that product.

Read it here:
http://seekingalpha.com/article/13895

Read some of the Q&A. Intel is full of inventory. They made wrong predictions. Now I fully understand Dell going AMD.

I'm just your loveable huggable Spud why on earth would you want to get rid of me?

Moo.
Another MMM!

 

[bixplus]

Man I think you are about to leave and Baron will stay. And take Spud with you.
That’s cool because he is one of few that post good things here.

We are planning for revenue in the third quarter to be between $8.3 billion and $8.9 billion, an increase of approximately 7.5%, in line with seasonal patterns.

Then, relative to Q4, to Glen's point, there are scenarios that Q4 is down again. If it was cost in Q3, wouldn't that improve as we went through to Q4?

Going into the third quarter, I would expect profits to be about flat.

So overall, expect a little increase in the third quarter, but I do not think it is a big increase.

Second question, as I look at the timing and the mix of your ramp, it seems to me like an awful lot of this inventory addition has got to be dual-core Pentium D, right?

Some of it is, yes. There was an increase in inventory of that product.

Read it here:
http://seekingalpha.com/article/13895

Read some of the Q&A. Intel is full of inventory. They made wrong predictions. Now I fully understand Dell going AMD.

You're missing the point. My challenge to BM is for him to make a specific reasonable prediction and be willing to live with the consequences of being right or wrong. His nonsensical statements like "I told you that was going to happen" after the fact is silly since he never makes a confirmed prediction to begin with. So my challenge is to get him to step up and make a concrete prediction with details before it actually happens.

So, it's all in the name of having some serious fun...but it's also about taking fun seriously.

Edit: Oh, and what's wrong with spud?

 

[dt]

dell is goin amd?

 

[GloriosoSLB]

Nothing is wrong. I was just kidding too.