14 DAY TRIAL // AMD tries hard to keep its remaining market shares intact and this job is much harder than you may think because Intel is going for an "all out" price and products war. On one side, there is AMD, desperate to keep from falling too much behind Intel in terms of market share, which has no processor directly comparable to the Core 2 Duo from Intel. The only logical move from AMD is to combat Intel's more pricey products with a significant price reduction of its own. And they did it. Until now it appears to be the right thing to do in order to keep Intel from grabbing all the desktop, mobile and server processor market. The downside to this strategy is that AMD is losing big money, practically giving away for petty cash most of its processors. On the bright side, the company might attract more buyers and, who knows, maybe even some converts from Intel's camp.
According to the Current Analysis analyst Toni Duboise cited by the Web site TGDaily, AMD was able to gain some market shares in the U.S., both in the mobile and the desktop segments. Intel is still dominating the market with 57 percent of all desktop systems, while AMD regained just one percent of the market back, rising from 42 percent to 43. As the new line of AMD quad cored processors for all market segments will not be launched until the last months of the year, there are concerns whether the company will be able to turn around and increase its revenues. On the notebook mobile market, AMD found the legendary honey pot and it seems as its Turion X2 processors are well selling in lower end systems that are below the $1000 mark.
"While fast-paced technological advancements have always been a precursor for the PC industry's accelerated technology churn rates, Intel's aggressive quad-core price strategy breaks with traditional newer technology premiums enjoyed by the industry for years. A few PC vendors and retailers will benefit in the near term, but if price erosion is indeed accelerated in all market segments, it will negatively impact the industry as a whole," Duboise wrote.
The best news for AMD is that most of its retail channels are intact and the market for them is stable, so the company still has a chance to increase its already low revenues. Because of the acquisition of the graphics chips ATI, combined with a dragging price war with Intel, AMD has now little cash reserves with $1.6 billion immediately available and $648 million under "account receivables".