The Road Ahead for Intel

Did Intel overcome its problems? It depends who you ask. Sure, Intel's core II due has been unbeatable on many fronts for several months. But how long will C2D maintain Intel's edge. The short answer for that is: not too long!

AMD proved to Intel that good old times are gone and it is all about the superiority of the product. The good all times when the margins were 60% will not come back unless AMD will go out of business. But I am sure AMD will make sure they will not go out of business. I am also sure that IBM will not let Intel rule the world of processors. IBM has been poring millions and millions of $$ to make sure they are not held by the "you know what". On a side note, Intel also will not allow for the disappearance of AMD. You see, you need a small company to live so you keep your family jewels far away from the government hands.

Intel proved to AMD it is also about execution and marketing. When their product was inferior, marketing stepped up and pushed sales up (2005, Intel Sales were their top record). AMD tried the marketing piece. It did help them when they had a superior product, but it did not perform as well when they did not have a competitive product. Also, execution history is not on AMD's side.

If Intel has not accepted the good old 80% market share company days are gone, then they will loose more and more. But I think they realized that. For Intel to stay competitive and have larger market and sales share, they have to execute very well on a superior product. For AMD, they just need to execute and deliver on time and IBM will do the rest. Intel has to fight on many fronts.

Is AMD out of steam for 2007?

I got to admit that the last two quarters were not so hot for AMD. Q1 2007 seems it is going to disappoint for sure but by how much? What I can read from Hector's comments in March, a month ealrier than when he should, that it is going to be probably the worst quarter for the last 3 years.

The most disturbing problem is in the incosistency of what AMD had said and what they had not say. They said that Barcelona is due Q2 07 but they did not show anything meaningful, yet. I mean, Q2 starts next month. They said it will be 40% better in performance than clovertown but they also said no meaningful impact till Q1 2008.

If this is not confusing to investors, I do not know what is? Sadlym it idicates tough times are coming AMD's way!