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AMD's well may be running dry

By DanLM ·

Intel is known for its heavy research-and-development spending even during lean times. In 2006, the company said it was eliminating 10,500 positions in a massive restructuring. But it still spent $5.9 billion on R&amp ? about 17% of overall revenue ? up from $5.1 billion in fiscal 2005.

By comparison, AMD plowed $1.2 billion ? more than 21% of its revenue ? into R&amp last year.

I didn't realize that the R&amp expense's for these two companies was this high. It's nice to see an industry that is always looking to improve it's products though, instead of sitting on its duffs just living off what it once created(Microsoft?). Ok, that was a cheep shot at Microsoft. I believe I read where they have an aggressive R&amp budget too. I just don't think it is as aggressive as AMD or Intel.

"What this comes down to is the companies are playing a long-term game," said Dean McCarron, principal analyst at Mercury Research. "The financial people would be delighted to hear AMD would not be investing in any factories. They would be delighted if Intel would not compete on price to gain market share and would focus on margins. That's great for the next three quarters, but a train wreck for both companies."

Investors are idiots. R&amp is what made these two companies great. It's something that will keep these two companies great.

As a side note to this. I use to be a die hard AMD fan, but with the dual core processor's released by Intel. My last purchase was an Intel. More bang for the buck. If the investors do not stifel AMD, I am sure they will be back with a comparable or better product. Intel needs AMD, just to keep them always looking to build better.


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Intel has done a great job of late

by TechExec2 In reply to AMD's well may be running ...

Intel's fastest CPU is definitely faster than AMD's fastest right now. But, unless you're buying that fastest $1000 CPU, you can still match price and performance with an AMD CPU (1).

AMD has promised strong answers this year (2).

I am optimistic that some way, somehow, AMD will find the financing to make the investments they must make to keep competitive with Intel. They are asking shareholders to approve a doubling of the common stock (3). This could raise billions in cash for them.

If AMD should fall, the prices of our CPUs will rise dramatically. Everyone will lose from that...Except Intel.


(1) ALWAYS use an AMD CPU when you build your PCs

(2) AMD has GOT GAME - Information about "Barcelona" is here!!

(3) AMD asks to double common stock to 1.5 billion shares

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Any tech company that doesn't invest as much as it can

by Tony Hopkinson In reply to AMD's well may be running ...

in R&amp is doomed. If they can't invest much, they are doomed, if they don't invest enough they are doomed.

Never let the financial people in the city run your business. They'll invest in you, take the money, get paid to bad mouth you, sell you short, take the money, bid for administration, take the money...

Seeing a pattern here?
City people like boom and bust they make money off both sides of the slope.

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