AMD Announces Strong Fourth-Quarter Results - Page 2

Nathan Brookwood, an analyst with Insight64, in Saratoga, Calif., said AMD has benefited from strong execution and stumbles by Intel over the past 18 to 24 months.

AMD was first out with 64-bit x86 chips with its Opteron and Athlon 64 processors in 2003, and with dual-core processors in 2005.

"Theyre really hitting their stride," Brookwood said. "As we start the year, AMD clearly is ahead in terms of performance, in terms of power, in terms of performance-per-watt."

In addition, sales of Opteron-based systems from Hewlett-Packard Co. and Sun Microsystems Inc. began to ramp last year.

Initially there were a lot of pilot programs using those servers, but those pilots turned into full production developments in 2005 as businesses saw the advantages in performance and power efficiency that AMDs chips had over Intels.

"AMD going into 2006 clearly has a momentum that Intel lacks," Brookwood said.

However, if Intel can execute on its roadmap, that gap could close, he said. If that happens, AMD can expect to see fewer defections from Intel users than it saw in 2005.

"It will be much more of a horse race [in 2006] between Intel and AMD on performance and power than it was in 2005," Brookwood said.

AMD officials have said over the past few months that they expect to be able to keep the technological lead over Intel through 2006.

Both vendors are looking to increase the features offered on their chips this year in areas such as virtualization and security.

Intel reported Tuesday that supply problems of chip sets hampered its ability to get desktop chips into PCs, even though the Santa Clara, Calif., company saw record shipments of desktop, mobile and server processors.

Responding to an analysts question, Ruiz said those problems did not artificially bump up AMDs numbers.

"There seems to be production struggles with our competitor, but I dont think it impacted our quarter," he said.


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