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AMD Admits To Slowing Sales 194

Posted by Zonk
from the bearer-of-bad-news dept.
An anonymous reader writes "Forbes is reporting that AMD has fessed up to investors about slowing chip sales. The price war that Intel has initiated seems to be taking its toll on the manufacturer." From the article: "The current drivers of business in the computer chip industry seem to revolve around Intel and AMD price war, uncertainty about how a slowing economy will impact consumer spending plans, and imminent product introductions from Intel that may be causing some consumers to hold off on purchases. Investors should get a better picture in the next few weeks--AMD will issue its full second-quarter report on July 20, a day after Intel is scheduled to report its results."
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AMD Admits To Slowing Sales

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  • The winners (Score:5, Insightful)

    by Z00L00K (682162) on Saturday July 08, 2006 @07:50AM (#15682524) Homepage
    are the customers - without competition we would have been paying a lot more for the power we get.
    • by MarkByers (770551) on Saturday July 08, 2006 @07:56AM (#15682532) Homepage Journal
      What about "Think of the corporations. :(" ? Haven't you been brainwashed yet? It looks like they missed you out. Don't you have a TV?
      • Oh please! Won't someone think of the soulless legal automata?

        I'm not some bomb-throwing anti-corporate activist. The way our economy is set up, we absolutely need them. But you have to think of "corporations" as "titanic powerful robots." Are titanic, powerful robots good or are they bad? Well, it depends on what they're doing and how they're programmed and what restrictions are placed on their actions, right? I hate how all discussions of economics and corporate policing turn into debates between ul
        • Citizen polarization is the friend of professional politicians because it forces issues into a binary choice. The news media also finds advantages in clear-cut black vs. white stories since everyone can then takes sides and bitch about the other guy. It works out well for those in power, but not all those in power are cronies, yes-men or crooked.

          On the other hand, lack of a clearly-defined agenda can cause endless waffling and indecision by "listening to everybody".
        • The main issue is not whether corporations are to be restricted, it is whether they should be restricted any more than people, or small businesses. Libertarians believe that corporations should follow the law, but they do not support persecuting them. And some people do not support taxing them because the taxes are always passed on to individuals and it makes the tax system less clear.
    • Re:The winners (Score:3, Insightful)

      by Traiklin (901982)
      without competition we would have been paying a lot more for the power we get.
      without competition we would be paying a lot more for speeds of about 900mhz by now, if we were lucky enough.
  • by D4C5CE (578304) on Saturday July 08, 2006 @08:02AM (#15682549)
    imminent product introductions from Intel that may be causing some consumers to hold off on purchases.
    Not mentioning precisely which products and technologies they mean (with links to time scales, specifications, and first test results of actual samples, to turn this claim into actual pieces of information) this could always be said of pretty much every IT company, all the time.
    • by AudioEfex (637163) on Saturday July 08, 2006 @12:50PM (#15683573)
      Consumers are holding off purchases...because they don't need new computers. The processor is the last thing most "Best Buy"-level consumers need to even think about replacing these days, and with upgradability so easy for the other major components the need has simply leveled out.

      We've reached a threshold where some people aren't going to need any "better" computers for quite some time. For the average user, once you've got a nice flat screen, a nice big HD, and a reasonably fast computer, that's all they are ever going to need to email, burn CDs, and browse the web. The people that have driven the market the last few years (newer and/or first time buyers) are not falling to the "new box every 24 months" syndrome that felt like the norm before.

      Add to that how easy things like storage and RAM are to upgrade these days (especially the former, aided by the convenience of USB), and most of the casual users (i.e. one or possibly two PC's in the home) I know are quite happy with what they've got. Unless you are an extreme gamer, there is little reason to upgrade. Same reason people don't upgrade Office every year (if they still use it...); to most people Office '97 does everything they'd ever want to do and then some. The only people upgrading are IT departments and corporations that just like to spend money. Very few industries need state-of-the-art tech, and even fewer individuals do.

      The individuals are learning, because they aren't buying. At least that's what it seems like to me.

      AE
  • by sweetnjguy29 (880256) on Saturday July 08, 2006 @08:35AM (#15682634) Journal
    I am currently in the market for a new computer. I was going to buy a new computer back in January, but I waited for a price drop for the AMD X2 chip that I wanted. Then I learned that there was going to be a completely new socket AM2 coming out that will use DDR2 RAM. So I held off a little longer. Its six months later, and now I hear that there is another AMD chipset coming out in January with 4 cores, and a new Intel chip coming out in a month that trounces anything AMD has.

    Plus, there are no reliable reviews of the new motherboards yet...and the reviews of both the new AMD and Intel chips are all preliminary...so, why should I commit right now? In fact, most major websites and magazines are saying to hold off buying!
    • by MarkByers (770551) on Saturday July 08, 2006 @08:46AM (#15682657) Homepage Journal
      I am currently in the market for a new computer. I was going to buy a new computer back in January, but I waited for a price drop for the AMD X2 chip that I wanted. Then I learned that there was going to be a completely new socket AM2 coming out that will use DDR2 RAM. So I held off a little longer. Its six months later, and now I hear that there is another AMD chipset coming out in January with 4 cores, and a new Intel chip coming out in a month that trounces anything AMD has.

      No matter how long you wait, as soon as you buy a computer it will begin its journey down from top-of-the-range to below entry-level.

      Given that you know that this is going to happen, why bother waiting? Just get a computer that fulfills your needs now. If in 2 years time that PC is no longer good enough for you, then get it upgraded.

      Who cares whether it is top-of-the-range or next best, as long as it is good enough for what you need?

      • Who cares whether it is top-of-the-range or next best, as long as it is good enough for what you need?

        For one reason...
        While I rarely upgrade CPU or Mobo without the other, I do often use RAM across generations of PCs. The system I'm using right now has 1GB of PC-133 RAM, removed from several other systems. PC-133 obviously doesn't have any future, and when it comes time to spend $100 on new sticks of RAM, I'd like to get something that will be useful (in less-performance-sensative systems) for years to c

      • No No No. Your missing my point. The problem right now is that the switch over to AM2 isn't an upgrade...its a "sidegrade". Same performance, same chip for the most part, and you get to use DDR2 memory. Woooop-di-doo! Conroe is basically a dual core with slightly better performance than the FX-62. Yippee.

        Right now I run the first generation of the AMD 3200+. Performance-wise, If I were to upgrade to an FX-60, I would see approximately a 100% to 125% performance boost. However, upgrading to a more af
        • And, as a follow up, I find myself going out and buying peripheral upgrades to my current system that are way more expensive and quality than what I have bought in the past. I just bought a $400 LCD screen and a $200 speaker system. I just hope that I am not screwed with the Hi-Def TV stuff, when I finally get a video card that supports it!
      • No no, I think the he's sensible to wait in this case.

        I was going to buy a Z1 (Konrad Zuse) originally, but decided to wait a while for the price of vacuum tubes to fall, then it looked like I was better holding off for a "transistor" based machine. To cut a long story short, now I'm waiting for a quad-core machine.

        I've saved a fortune by playing it safe over the years and just think how stupid I'd look now if I *had* brought that Z1!
      • Who cares whether it is top-of-the-range or next best, as long as it is good enough for what you need?

        Because if he can wait, it's b/c his current pc is good enough for what he needs, so in that case, why not wait for something significantly better? The new product rollouts this year aren't just die shrinks or clockspeed increases of the same part, they're entirely new platforms. Both AM2 and Conroe/Merom/Woodcrest require buying new motherboards in addition to new chips, and for those of us still on D
    • Welcome to the technology market, where there's always something better on the horizon.

      Buy what you need, when you need it, and don't worry if it's the absolute latest thing out. If you always wait for the latest & greatest thing you've just heard about, you won't end up with anything.

      OTOH, if you really don't need it, save your money. When you eventually do get around to buying, you'll always get more for your buck.

    • Why wait? Instead of building my own this time, I bought a brand new HP Pavilion from Circuit City. $550 got me an Athlon X2 3800, 1GB memory, 250GB hard drive, DVD-burner, legal license of Windows XP, and all the bells & whistles including those tight "Dancers" in XP Media Center :).

      The CPU alone goes for $297 on newegg.
    • Another poster answered your post but I want to add to that...

      Intel has gone through the same socket changes from 8xx to 9xx for the different cores. I'm sitting here with a 915G motherboard that GUESS WHAT, can't run the latest 775 processors. By your logic we should all still be on Socket1 processors with a 50Mhz front side bus.

      The more realistic answer is to just buy what you can afford and need. An AMD 4400+ should be fast enough for pretty much anything in the forseeable future. Or at least, the "l
    • Won't the 4 core chip use the AM2 socket?

      I was going to wait until the AM2 sockets came out, but my PC had problems last November and I had to replace the MB and CPU. I've been having a great time with my 3800+ ever since.

      Some people will balk at the price difference between the Pentium D and the 3800+, I design my system to be cool. A high effiency power supply and the 3800+ means less heat generated.
    • The AMD with 4 cores will probably start out being quite expensive, being the new top model. So waiting until January is probably a waste of time.
      I would, however, wait for the release of the Intel "Conroe" and read some independent reviews on it before deciding on a processor (until now, Intel has pretty much dictated what tests the public gets to see). The AMD X2 has been in the market for a while. You can get independent reviews for that now.
      At that point, I also expect another round of price cuts, so e
    • If you need a new computer, you'll buy now. Prices are suddenly great, and the current line will have a shelf-life of about 2 1/2 - 3 1/2 years, just like processors always do. If you just WANT a new computer, then the best time to buy will *always* be "6 months from now."
  • dying industry (Score:5, Interesting)

    by Anonymous Coward on Saturday July 08, 2006 @08:41AM (#15682651)
    The CPU industry will probably implode in the next decade or two.
    1) Upgrade cycles just keep getting worse as business and people realize they do not need the latest and greatest. During the boom, a 3 year upgrade cycle was average, now it is in the range of 7 years. For the majority of businesses, all the box has to do is run Office decently. Only the high end enterprise and HA market will care about upgrading to the latest. And even they are getting cheap by simply clustering 2nd generation boxes.
    2) They are hitting technology limits. It is doubtful that they will be able to get below 32nm silicon (right now the best is 65nm). That is why we are seeing multi-cores and performance/rating specs being redefined to account for threading capability; It is more an act of desperation than innovation. Yes, some technology will take over-- quantum, bio, optical, but there will probably be a significant waiting period for the new tech to emerge. Moore's final predicition is rapidly coming true; It is becoming too expensive to build state of the art fabs to justify the returns.
    • Re:dying industry (Score:3, Interesting)

      by ScrewMaster (602015)
      Technology limits are one thing, but the ones we have have taken us to about where we need to be for the time being. As you say, for the desktop market the need for speed really isn't there any longer. So Intel is (much like Microsoft, which is running into its own hard limits) casting about for other markets to enter, such as the embedded-systems space, wireless technology and anything else that might be profitable in the near term. The question really isn't about processor speed, but more about whether In
    • Re:dying industry (Score:3, Interesting)

      by tomstdenis (446163)
      That's why they are improving in other directions. Not just higher clock rates but more efficient [IPC, MIPS/watt, etc]. That and there are many people who can find ways to fill pretty much any cycle count processor.

      For the desktop/laptop market things the more dominating factors will switch from speed to power as people try to reduce their electricity and cooling bills. I'm sure if you could have a 10W Opteron running as fast as a 95W one you'd be interested in making the switch.

      Tom
      • Re:dying industry (Score:2, Interesting)

        by evilviper (135110)

        I'm sure if you could have a 10W Opteron running as fast as a 95W one you'd be interested in making the switch.

        Not too likely, actually. You'll save a few cents each month on your electric bill, and the fans will be somewhat quieter. Few people would want to spend more money for no performance improvement, and a hardly noticable savings in power.

        In portables the benefits would be more significant, but with most mobile CPUs below 35watts now, you won't be saving that much power. A lower-power LCD backligh

        • by rcamans (252182)
          A 10 w cpu is not a hardly noticable improvement over a 95 wat proc in a laptop.
          It translates into much longer battery life with a smaller battery, ie, a lighter laptop.
          A lighter laptop is much easier to carry around, and even small improvements in laptop weight are very noticable. Yes, most cpus run at a lower wattage, when they are clock throttling. But if their continuous full clock power were 10 W...
          Especially if the laptop turns into a pda / cell phone / blackberry.
          There is tons of room for improvement
          • At the International Symposium of Computer Architecture (ISCA) a couple weeks ago in Boston, Dr. Phil Emma of IBM gave a keynote talk. He said that CPUs will become commodized to the same level as DRAM is today. I think there could be truth to what he says and that innovation will have to come from higher levels than the CPU. And he is one of IBM's lead technologists.
          • A 10 w cpu is not a hardly noticable improvement over a 95 wat proc in a laptop.

            Congratulations on your complete lack of reading comprehension skills.

            As I already said: "most mobile CPUs [are] below 35watts now,"
            That means you can't possibly save the theoretical 85W by switching to a lower-power CPU... unless you have a CPU that GENERATES ELECTRICITY and gets COOLER as it operates!

            Yes, most cpus run at a lower wattage, when they are clock throttling. But if their continuous full clock power were 10 W...

            No,

      • I'd also want to calculate: How much will the 10W save me in cash until the next time I have to upgrade? It may well make more sense to keep the 95W one until they're making 1W ones, then buy the 10W one dirt cheap.
        • Again do I have to drag out the math of scales here?

          Saving 85Wh of power, times a couple million users == 170MWh of energy saved. [Not including the inefficiency of power supplies, power lines feeding your home, air conditioning, etc]

          Now, here's the tricky part, follow with me. Energy is a limited resource. The more competition for it the more it cost.

          Now, here's where it becomes a big deal. Things you buy, like your purple translucent homestyle dildo ... take electricity to make. That power has to come
          • This same sort of logic applies to cars. Is 45Mpg really that much better than 35? For you individually probably not. Multiply that by the millions of cars out there though and it's a big deal.


            Their will come a time when that 10 MPG is worth it for most people, and the same is true of CPU power usage.
    • Absolutely right, the evidence for the commoditization of the general processor market is everywhere you look, at any corporation or even just amongst your friends. I have a large "social network of computers" because (like many here, I suspect), I get to help everyone I know to fix their PCs. I don't know of any CPUs in my social network that even reach 1.2 GHz.

      - My own PC is a laptop running a PIII 1.13GHz CPU, the fastest CPU anywhere in my social network
      - I recently visited my parents to help them repla
      • As someone that used dual-processor, noise-poluting desktops for years, I can tell you that there is a major benefit for having dual-core on the desktop. Does everyone need this? Of course not, but there are significant advantages for systems administrators and programmers, the heaviest multitaskers. Compile, listen to your Ogg-Vorbis encoded music, burn a cd, and browse the web at the same time without fear or slowdown. I've been "back" to single-core for two years now and I've dreaded every day of it -
      • I don't know who's out there snapping up the multi-GHz multi-core 64-bit CPUs, but I can't imagine what they're doing in today's software ecosystem (apart from the gamers and the physicists) that could require that sort of processing power.

        Video editing is a typical task that requires lots of CPU power. As CPUs have gotten more powerful, we've been able to move from VHS quality footage (quarter D1) to DVD (full D1). That requires 4x the processing and with my 2-year old dual-Opteron system it takes me
    • The CPU industry will probably implode in the next decade or two. ... For the majority of businesses, all the box has to do is run Office decently.

      I see, that's because no one needs more than 640k of memory, right? The funny thing about computers is how every time someone says no more power is necessary somebody else invents a new application.

      What do you mean, run office "decently"? If it's just basic text editing, then any old VT-100 terminal coupled to a 6502 CPU motherboard with 64k memory and a 1.44Mb

    • Your first paragraph it pretty on, people just don't need top of the line machines to do most work anymore.

      Your 2nd one is way off. There's no problem with 45nm right now, and 32nm will work too. And multi-cores isn't a dodge because of the inability to reduce feature size (increase transistor count), it is a simple trick to USE UP all those transistors it would otherwise take a lot of redesign to utilize well. So, we go to small process, have more transistors than we know what to do with, and so add cores.
    • Why would quantum/bio/whatever be needed if all you want to do is run Office?

      640K... I mean Office... should be enough for everybody right?
  • It's not surprising that sales are down, considering this is always the weakest quarter and the huge price war.
    However according to Inquirer (http://uk.theinquirer.net/?article=32880), server sales continue to improve.
  • still unclear (Score:4, Insightful)

    by Monoman (8745) on Saturday July 08, 2006 @09:34AM (#15682788) Homepage
    From TFA, it is still unclear if AMD is losing market share or if the whole chip market is slowing right now. Basically Intel and AMD are in a price war (good for consumers) and we will have to see how it all works out.

  • My problem with AMD (Score:5, Interesting)

    by Revolver4ever (860659) on Saturday July 08, 2006 @09:45AM (#15682819)

    From Newegg:

    Athlon XP2 3800+ : $297.00 Pentium D 930: $170.00

    Benchmark results are very similar with the Athlon winning most of the game benchmarks by a bit. Is that bit worth $130.00? Hell no.

    I really wanted the 3800+ but it's price has remained the same for a very long time now. Meanwhile, Intel has been slashing prices daily. At the end I caved in and could not be happier. Until AMD starts price matching Intel processors, I'll stick with my Pentium D.

  • I think it's bound to happen if AMD can't muster enough resources to continue competing that they will need help. And no, I doubt AMD buying ATI will do much of anything. It seems AMD will have to be bought by IBM if they want the same deep pockets necessary to compete with Intel. They already work together, so it's definitely possible. I don't see how AMD can possibly do more for every bit of money than Intel forever.
  • by Brian Stretch (5304) on Saturday July 08, 2006 @12:11PM (#15683407)
    1) Intel is dumping its aging Netburst cores onto the market at such low prices that they're displacing lower-end AMD sales.

    2) Intel is setting up for a Big Bath [thefreedictionary.com] in their Q2 earnings report. Their selling off of their ARM processor unit to Marvell is part of this (they'll have to recognize a huge loss on the sale).

    3) All of this is obvious to AMD, so they're putting even more emphasis on Opteron sales where Intel is weakest. This results in lower total sales, as they sell in far fewer numbers than low-end CPUs, but should keep net income at a nice level since they're extremely high margin chips.

    4) Since each Opteron sale displaces an Intel Xeon sale, Intel's net income is hurting.

    5) Any advantage Intel will gain from C/M/W will be gone when AMD does their transition to 65nm in Q4. Sooner if Intel screws up, as is reported [theinquirer.net].
    • 5) Any advantage Intel will gain from C/M/W will be gone when AMD does their transition to 65nm in Q4. Sooner if Intel screws up, as is reported.

      Huh? Woodcrest is launching at 3GHz today.
      Do you think frequency will sit still for 6 months?
      People have been getting 4GHz overclocking results using AIR cooling today.
      This shows that the process has headroom to scale.

      When AMD gets to 65nm in late Q4 or more likely early 2007, they won't have the process setup to clock that high initially.

      That's Intel's main advan
    • Well, Intel's already on 65nm today. They have plans to move to 45nm by the time AMD finally gets around to 65nm. The Core 2 has been trouncing AMD's top-end chips in the benchmarks. Frankly, I think AMD's sales have been slowing because the AMD hype has died down, and Intel's Core chips are just really that good. Core 2 will be incredible according to the reviews.
      • What review sites do you trust? I got disgusted with most of them a couple of years back--the last time I needed to spec PC hardware. I'm sure there must be some reputable ones out there, but I don't know who's currently the best.
  • Some numbers (Score:5, Informative)

    by overshoot (39700) on Saturday July 08, 2006 @12:18PM (#15683435)
    • PC sales are down 14% in the quarter
    • Intel cut prices 30%
    • AMD revenue projections are down 7%
  • My 3 year old 3ghz box is fast enough and capable enough. I'm sure I'll get new equipment in the future sometime, but it will be after VISTA comes out.

    You may have reservations about adopting VISTA, but when you buy equipment a few months after major OS releases you get the longest support and the longest productive use of your equipment. I'm sure I'm not alone in milking my Window-XP until VISTA comes out (even then I won't be on the bleeding edge of first buyers).

    This in my opinion is a major fac
  • I get the monthly flyer from Micro Center even though I'm pissed off at rebate failure and will not buy any item over $30 (no rebates allowed) like paper or cable etc. it does gove me the chance to keep up with market changes (watching the book store computer section change also is a good market indicator) ....

    But here is the thing. I've generally gained a distaste for the computer industry leading edge stuff as in 3 months what is out is old. So with this in mind, I wait for people to throw their old syste
  • Made one mistake, the EE cpus.

    Broadcasting we can make faster silicon but we're going to make you pay a leg for it...

    Now they're doing what AMD used to do, great performance from their consumer level chips... Not just their Enthusiast level chips.

    2400 goog chip 62+ not good chip...
  • Why is anyone reading Forbes? A publication whose senior editor Daniel Lyons has written numerous articles supporting SCO and troll baiting Linux users. One of Lyons' masterpieces begins with "Linux zealots...". Lyons is senior editor.
  • The price war that Intel has initiated seems to be taking its toll on the manufacturer.

    I just put down some money for a new AMD X2 system (nothing all that special, but it'll have a lot of RAM and two video cards).

    Since the store's online customization program was broken I ended up having to go there in person to place the order. Things were going fine until I realized that I was being set up for an Intel-based system, contrary to all my previous email and telephone communication. It made me wonder if

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