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Dell May Expand Use of Advanced Micro Chips in Bid to Aid Sales
Aug. 17 (Bloomberg) -- Dell Inc., the world's largest personal-computer maker, may expand its use of Advanced Micro Devices Inc. chips in an effort to boost sales by offering a wider variety of PCs.
An announcement may come as early as today, when Dell reports second-quarter earnings, said Cindy Shaw, an analyst at Moors & Cabot Inc. in San Francisco, who said she has discussed the plan with people in the computer industry. The move would follow Dell's decision in May to use Advanced Micro chips in some computers, ending Intel Corp.'s run as Dell's exclusive supplier.
Dell's sales in the quarter just ended rose 4.3 percent, the slowest growth rate in four years. Rivals such as Hewlett-Packard Co. have stolen customers by tapping demand for computers with Advanced Micro chips that were more efficient and sophisticated than Intel's.
``Dell could use some good news and adding AMD will be a positive,'' Shaw said. ``At the high end, AMD is better at graphics and gaming.'' She rates Dell shares a ``sell'' and doesn't own them.
------(Blöder Quatsch. Keine Ahnung. Frauen und Technik. Sorry!)-------
Dell doesn't comment on future products, spokesman Bob Pearson said. ``Dell continues to believe we will end the year with the best and broadest product line in our history,'' he said. Advanced Micro spokesman John Taylor declined to comment, as did Intel spokesman Bill Calder.
Server Chips
Shares of Round Rock, Texas-based Dell, down 24 percent this year, rose 65 cents yesterday to $22.73 in Nasdaq Stock Market composite trading. Sunnyvale, California-based Advanced Micro shares rose $1.70 to $22.57 in New York Stock Exchange composite trading. They've fallen 26 percent this year. Intel, down 25 percent this year, rose 48 cents to $18.61.
Dell may produce as many as 4 million PCs with Advanced Micro chips in the fourth quarter, said John Lau, an analyst at Jefferies & Co. in New York. That's about a third of the PCs Dell is expected to ship. Lau said he based his forecast on his checks with Dell's Taiwanese contractors.
``It's more a question of when, not if,'' Dell starts using Advanced Micro chips in more widely sold desktop and notebook PCS, said Shaw Wu, an analyst at American Technology Research in San Francisco. `` I do hear from my sources in Asia that the manufacturing is going on.'' Dell used its first Advanced Micro chip, called the Opteron, in server computers, high-powered machines that run Web sites and corporate networks.
Sept. 12 Meeting
Dell probably will provide details on its Advanced Micro- based products at a meeting for analysts and reporters in New York on Sept. 12, Wu said. He said he expects Dell to begin shipping the Advanced Micro PCs in September or October.
Dell, hurt by service problems that have alienated U.S. consumers and what it called ``aggressive pricing,'' said last month that profit for the quarter ended Aug. 4 missed analysts' estimates for a second straight period.
Net income fell to 21 cents to 23 cents a share from 41 cents a year earlier, Dell said. Analysts had anticipated 32 cents. The 4.3 percent rise in sales to $14 billion compares with 15 percent growth a year earlier. The company will report results after the close of trading.
This week, the company said it will recall 4.1 million notebook batteries after finding some had burst into flames. That may deter some potential Dell customers, Shaw said.
Dell's shift to Advanced Micro came after Chief Executive Officer Kevin Rollins said Intel had ``slipped technologically.''
Sales Hurt
Hewlett-Packard, International Business Machines Corp. and Sun Microsystems Inc. were using more Advanced Micro chips for computer servers. That doubled Advanced Micro's market share in a year and hurt sales at Dell, the only maker to exclusively use Intel processors.
Advanced Micro went on to grab more than 20 percent of the market for PC processors for the first time in more than four years in 2005.
The lost business forced Santa Clara, California-based Intel to predict in April that sales will shrink for the first time in five years in 2006.
Dell needs to cater to customers who may prefer one chip over another, said CEO Rollins, 53.
``It makes sense to have AMD in the product line so no matter who is ahead, we have the products to offer,'' Rollins said in a June 27 interview at Dell's headquarters in Texas. ``If the customers really want a technology or a capability or a brand, I think we're now committed to make sure we offer that.''
Dell lost market share in the U.S. in the calendar second quarter to Hewlett-Packard and Gateway Inc., two companies that sell Advanced Micro-based PCs, according to Framingham, Massachusetts-based research firm IDC. Dell's shipments in the U.S. rose 6.4 percent compared with gains of more than 15 percent by its two nearest rivals, IDC said.
`` AMD does have a following now, that's what's different,'' said Citigroup Inc. analyst Glen Yeung in San Francisco. ``Five years ago people didn't like AMD.''
www.bloomberg.com/apps/...id=aKaO4zxVCzY4&refer=top_world_news
Aug. 17 (Bloomberg) -- Dell Inc., the world's largest personal-computer maker, may expand its use of Advanced Micro Devices Inc. chips in an effort to boost sales by offering a wider variety of PCs.
An announcement may come as early as today, when Dell reports second-quarter earnings, said Cindy Shaw, an analyst at Moors & Cabot Inc. in San Francisco, who said she has discussed the plan with people in the computer industry. The move would follow Dell's decision in May to use Advanced Micro chips in some computers, ending Intel Corp.'s run as Dell's exclusive supplier.
Dell's sales in the quarter just ended rose 4.3 percent, the slowest growth rate in four years. Rivals such as Hewlett-Packard Co. have stolen customers by tapping demand for computers with Advanced Micro chips that were more efficient and sophisticated than Intel's.
``Dell could use some good news and adding AMD will be a positive,'' Shaw said. ``At the high end, AMD is better at graphics and gaming.'' She rates Dell shares a ``sell'' and doesn't own them.
------(Blöder Quatsch. Keine Ahnung. Frauen und Technik. Sorry!)-------
Dell doesn't comment on future products, spokesman Bob Pearson said. ``Dell continues to believe we will end the year with the best and broadest product line in our history,'' he said. Advanced Micro spokesman John Taylor declined to comment, as did Intel spokesman Bill Calder.
Server Chips
Shares of Round Rock, Texas-based Dell, down 24 percent this year, rose 65 cents yesterday to $22.73 in Nasdaq Stock Market composite trading. Sunnyvale, California-based Advanced Micro shares rose $1.70 to $22.57 in New York Stock Exchange composite trading. They've fallen 26 percent this year. Intel, down 25 percent this year, rose 48 cents to $18.61.
Dell may produce as many as 4 million PCs with Advanced Micro chips in the fourth quarter, said John Lau, an analyst at Jefferies & Co. in New York. That's about a third of the PCs Dell is expected to ship. Lau said he based his forecast on his checks with Dell's Taiwanese contractors.
``It's more a question of when, not if,'' Dell starts using Advanced Micro chips in more widely sold desktop and notebook PCS, said Shaw Wu, an analyst at American Technology Research in San Francisco. `` I do hear from my sources in Asia that the manufacturing is going on.'' Dell used its first Advanced Micro chip, called the Opteron, in server computers, high-powered machines that run Web sites and corporate networks.
Sept. 12 Meeting
Dell probably will provide details on its Advanced Micro- based products at a meeting for analysts and reporters in New York on Sept. 12, Wu said. He said he expects Dell to begin shipping the Advanced Micro PCs in September or October.
Dell, hurt by service problems that have alienated U.S. consumers and what it called ``aggressive pricing,'' said last month that profit for the quarter ended Aug. 4 missed analysts' estimates for a second straight period.
Net income fell to 21 cents to 23 cents a share from 41 cents a year earlier, Dell said. Analysts had anticipated 32 cents. The 4.3 percent rise in sales to $14 billion compares with 15 percent growth a year earlier. The company will report results after the close of trading.
This week, the company said it will recall 4.1 million notebook batteries after finding some had burst into flames. That may deter some potential Dell customers, Shaw said.
Dell's shift to Advanced Micro came after Chief Executive Officer Kevin Rollins said Intel had ``slipped technologically.''
Sales Hurt
Hewlett-Packard, International Business Machines Corp. and Sun Microsystems Inc. were using more Advanced Micro chips for computer servers. That doubled Advanced Micro's market share in a year and hurt sales at Dell, the only maker to exclusively use Intel processors.
Advanced Micro went on to grab more than 20 percent of the market for PC processors for the first time in more than four years in 2005.
The lost business forced Santa Clara, California-based Intel to predict in April that sales will shrink for the first time in five years in 2006.
Dell needs to cater to customers who may prefer one chip over another, said CEO Rollins, 53.
``It makes sense to have AMD in the product line so no matter who is ahead, we have the products to offer,'' Rollins said in a June 27 interview at Dell's headquarters in Texas. ``If the customers really want a technology or a capability or a brand, I think we're now committed to make sure we offer that.''
Dell lost market share in the U.S. in the calendar second quarter to Hewlett-Packard and Gateway Inc., two companies that sell Advanced Micro-based PCs, according to Framingham, Massachusetts-based research firm IDC. Dell's shipments in the U.S. rose 6.4 percent compared with gains of more than 15 percent by its two nearest rivals, IDC said.
`` AMD does have a following now, that's what's different,'' said Citigroup Inc. analyst Glen Yeung in San Francisco. ``Five years ago people didn't like AMD.''
www.bloomberg.com/apps/...id=aKaO4zxVCzY4&refer=top_world_news
