For AMD, following Intel's numbers hard to do

SAN FRANCISCO - Advanced Micro Devices Inc. is scheduled to report second-quarter results after the market closes Tuesday. Below is a summary of analyst opinion and key developments related to the period.

OVERVIEW: As the world's No. 2 maker of computer microprocessors, AMD has long been a thorn in the side of market leader Intel Corp. — whose chips power about four out of every five PCs on the planet. Only in the last few years has AMD emerged as a serious rival in all three categories in which it competes with Intel (servers, laptops and desktops).

While AMD has struggled with serious financial problems, it has made some strong moves to try and keep Intel at bay.

In May, AMD scored its biggest victory yet in its long-running antitrust fight against Intel when the European Union slapped Intel with a record $1.45 billion fine. The EU ruled that Intel abused its dominant position in microprocessors — the electronic brains of PCs — to strong-arm customers into buying only Intel chips, a claim AMD has been making for years. Intel disputes the allegations and is appealing the ruling.

The fine, which Intel had to pay while the case is being appealed, whacked Intel's profit for the latest quarter, leading to Santa Clara-based Intel's first quarterly loss since 1986.

The results, reported July 14, did contain some hopeful signs for the weak PC market, which last year suffered through its worst holiday season in six years. That could help AMD.

Intel believes the PC business is on the mend, with demand improving in the U.S. and China. Large corporations still aren't spending freely, though.

AMD's and Intel's market share fluctuates constantly, with Intel picking up share as AMD has struggled. There are signs, though, that AMD is reversing some of those market-share losses. Market research firm iSuppli Corp. said last month that AMD increased its market share at Intel's expense in the first quarter, in part because of strong sales of laptop chips.

AMD has done some extreme things to right its course, including changing CEOs and spinning off its chip factories into a separate company to save money. The company is still struggling to turn a profit, however.

BY THE NUMBERS: Analysts expect AMD to lose 48 cents per share on $1.13 billion in revenue, a 16 percent sales decline from last year.

ANALYST TAKE: Intel's better-than-expected numbers won't necessarily translate into strong results for AMD, warned Martin Reynolds, a vice president and research fellow at Gartner Inc.

"The challenge is, it's hard to tell how much of that is the market or possibly Intel gaining some share," Reynolds said. "I don't know that we would see a disaster from AMD, which is what you'd expect to see if they didn't have these new products out there ... Don't expect anything spectacular from AMD, in either direction."

AMD's finances have been in tatters for more than two years, and AMD has lost billions. Many analysts will be looking closely at AMD's sales even more than the bottom line for clues about the company's turnaround.

STOCK PERFORMANCE: AMD's stock started April around $3 and has risen about 33 percent to around $4 per share. Intel's stock has jumped from around $15 in April to nearly $19 per share after the latest earnings report.

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