Page Two

By Mark Hachman  |  Posted 2004-01-20 Print this article Print

AMDs flash business, meanwhile, recorded $566 million worth of revenue, which jumped 166 percent from the same period a year ago. AMDs flash business reported a $3 million operating loss for the quarter, however, partially because of strong competition in low-end products. Although AMD and Intel virtually dominate the high-end NOR flash business, a number of companies are in "scrambling for survival" mode, selling off low-end flash products at cut-rate prices, executives said. AMDs line of "MirrorBit" flash—which stores two bits of data in a single flash cell—has been the companys strongest seller, followed by its Multi-Chip Package (MCP) line.
During the third quarter of 2003, AMD closed its flash lines temporarily to allow the market to pick up. "Since that time, activity has increased dramatically," Ruiz said, and the low-end market will actually be "tight," or somewhat supply-constrained, until the second quarter of this year, he said. Lead times have been as high as 13 weeks, executives said.
For the year, AMD expects to spend about $1.5 billion in capital expenditures, the majority of which will be used to build AMDs new Fab 36 in Dresden, Germany; fund the expansion of Spansion; and convert Fab 30s production lines to 90 nanometers. Fab 36 will also produce AMDs first 300-mm wafers beginning in 2006, Ruiz said AMD kept a tight lip on its first-quarter outlook, however, stating only that both the company and its microprocessor division expect slightly lower revenue consistent with the typical seasonal decline that occurs in the first quarter. AMD expects flat flash revenue, the company said. "Looking forward, we are increasingly confident about our capacity to succeed," Ruiz concluded. (Editors Note: This story has been updated since its original posting to include additional financial information and comments from AMDs Ruiz.)


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