AMD is looking to reap the benefit from Intel’s chipset design flaw earlier this year, when it reveals its first quarter results later this month.
Reports indicate that Intel’s Sandy Bridge platform, which according to Intel President and CEO Paul Otellini was expected to account for a third of the company’s 2011 revenue, generating more than $125 billion in revenue for the PC sector, may not be upping sales of notebook PCs as much as expected.
An FBR Capital Markets analyst checked on overall builds of PCs in the first quarter with the top six notebook manufacturers, and found that numbers are lower than anticipated.
According to Craig Berger at FBR, “Intel’s Sandy Bridge products are not stimulating as much end demand as expected, likely impacting AMD too.”
At the Consumer Electronics Show in Las Vegas earlier this year, both companies unveiled processors with integrated CPUs and discrete-level graphic processors designed to improve high definition video and 3D rendering and gaming on systems.
The new chips are also aimed at improving space and cost savings, resulting in thinner, lighter and more power efficient PCs and notebooks.
IHS iSuppli has said that it expects 230 million notebooks to be sold this year, half of which would sport graphics enabled microprocessors, and rising to 83 percent by 2014.
45 percent of desktop PCs sold this year are also expected to sport more powerful graphics capability, with the number rising to 76 percent by 2014.
What is probably hurting Intel, according to Berger, is the design flaw that Intel encountered in its 6-Series chipset, Cougar Point, which has since been corrected by Intel.
AMD officials have said that they expect to benefit from this flaw, to exceed their first quarter revenue expectations.
However, Berger says any bump in revenues for AMD would be short lived.
“If AMD does achieve the high end of revenue guidance, or potentially better, the upside is likely short term in nature and due to customers turning to AMD for product when Intel’s Sandy Bridge was less available due to the chipset bug recall,” Berger said.
“For 2Q, we think AMD’s revenues will fall [quarter over quarter] .”
AMD will announce its first quarter results on April 21.
