![]() ![]() Intel on the other hand has already moved to the 45-nanometer process, and is on track for the 32-nm process by the end of this year. The company is still moving operations to the upgraded 45-nanometer process, which should lead to faster and more power-efficient chips at a lower cost. The company unloaded old chips manufactured using the 65-nanometer process, causing a drop in margins, analysts said. Margins also took a hit because of sales of aging chips, which dominated AMD's shipments, analysts said. But the good news is AMD could see shipments increase as it is getting more chip orders from PC makers, he said. It reflects on the margins," Spooner said. "Even more difficult for companies is end-users are purchasing less notebooks in general. Because the demand for laptops has slowed, chip makers like AMD have dropped chip prices to attract more buyers. That has materially affected the margins of chip companies like AMD and Intel, but Intel has deeper pockets to bear the brunt of such an impact, he said.ĪMD is also feeling the pressure of reduced laptop shipments, said John Spooner, senior analyst at Technology Business Research. The recession has forced many consumers to trade down to inexpensive laptops, which has affected the pricing of microprocessors, said David Wu, an analyst with Global Crown Capital. "Advanced Micro Devices reported disappointing second quarter results yesterday due to unusually weak gross margins," said Craig Berger and Robert Pikover, financial analysts at FBR Capital Markets, in a research note issued on Wednesday. Weak gross margins reflect poor profit margins on products, and that could delay AMD's efforts to become profitable, analysts said. Gross margins are an important measure for chip makers as they show a company's profitability after absorbing business costs. ![]()
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