The tale is long and convoluted, but it starts out with an analyst and I talking over a coffee and an evil strawberry milkshakeish creation. He was lamenting that AMD's brutal capacity constraints meany that there is little chance that they will beat their numbers. If you know you can make X units max, and your ASP is Y, your income for the quarter is XY.Read more over here.
One potential upside is that we hear AMD is skewing the product mix toward higher margin parts, notably Turions and Opterons. They may only be able to make X, but they are making more valuable units. While I doubt this will end up as an upside surprise, it won't hurt margins quarter over quarter.
The other interesting bit is a lot of people are talking down Vista and talking up how it will have a negative impact on PC sales over the non-denominational holiday festive season. The train of thought goes like this, people will not buy PCs for the sprouts because they won't have Vista. This will lead to doom and gloom, market collapse, and puppies with sad eyes looking up at you.
AMD's capacity problems a good thing?
Posted on Wednesday, Nov 08 2006 @ 00:36 CET by Thomas De Maesschalck