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Who acquired and who lost from AMD’s decision to dispose of its own production?
The source made an attempt to evaluate AMD’s decision to abandon its own production. As you know, AMD plans to spin off production into a new enterprise, created with the participation of investors from the UAE. What will be the consequences for the company and the industry as a whole?
Obviously, AMD will benefit from such a move as it can focus on development and free itself from the costs associated with the development and operation of the production base. It is completely irrational for AMD to compete in capital expenditures with a much larger competitor, Intel. Given the current financial situation, AMD cannot afford to build new factories or master a new generation of equipment.
Will receive his winnings in the State of New York. As you know, in 2021 AMD announced its intention to build a 300mm factory here, after which the state allocated 100 million. Doll. to create basic infrastructure. Recently, the project looked doomed to oblivion, but help from the East changes the matter.
Finally, customers using semiconductor contract manufacturers will also benefit. The emergence of a large independent manufacturer will lead to increased competition and lower prices.
It turns out that there are no losers?
Yes, the source answers. First of all, this is AMD. The split decision shows that the company could not survive as an independent developer and manufacturer.
The negative effect will be felt by companies that produce PCs on an OEM basis. They used to have a choice between two strong x86-compatible processor manufacturers. Intel and AMD nudged each other, accelerating new models and lowering prices. AMD is now betting on division. If it doesn’t work, who will AMD ask for help??
The emergence of another manufacturer of semiconductor products, albeit relatively, but still independent, may cause increased competition in the industry and lower prices by reducing profits. This is a dangerous outlook in a downturn. What’s good for customers can be disastrous for manufacturers.
Source’s point of view may be controversial. It’s hard to say what the real balance of pros and cons of the deal is. Either way, one thing is clear – AMD’s move will have big consequences for the industry.
Source: EE Times