On The Call: AMD COO links good CPU shipments to PC production but won’t predict holiday surge

Thursday, October 15, 2009

On The Call: AMD COO mum on holiday PC demand

SEATTLE — While Advanced Micro Devices Inc.’s financial success is closely tied to whether consumers and businesses are buying computers, it’s hard to say whether a good third-quarter report from the chipmaker means PC companies are expecting sales to surge around the holidays.

AMD’s uptick in microprocessor shipments might mean computer makers were feeling optimistic — Microsoft Corp.’s new PC operating system, Windows 7, goes on sale next week and is expected to be more popular than the current version, Vista.

But it might just mean that PC companies had let their supplies of chips dwindle during the recession, and needed to start stocking up again now.

Financial analysts pressed AMD CEO Dirk Meyer and Chief Operating Officer Robert Rivet for a clue as to how tightly they think chip shipments are matching up with actual PCs in production. In this case, extra “inventory” would mean computer makers aren’t expecting big sales.

But Meyer and Rivet refrained from speculating.

QUESTION: You sound worried about inventory.

ANSWER (Rivet): I feel real comfortable the supply chain is as tight as can be and it’s prepped for the launch of these new products. And again, what I think we both don’t know, Dirk and I, is, what is the consumer appetite to buy new products? Is it in line with what the OEMs (PC makers) are building or not? We won’t know until we see some of that data.

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