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Bear Stearns upgraded Advanced Micro Devices (NASDAQ:AMD) from Peer Perform to Outperform and introduced a year end price target of $29. The upgrade is based on:

1) more benign ASP decline in 3rd quarter and 4th quarter as AMD is willing to walk away from low margin business.
2) healthy channel inventory now as compared to late June.
3) considerable upside in MPU unit shipments for 3rd quarter and 4th quarter, particularly for notebooks.
4) expectation that AMD’s market share will increase 210 bps in 2007, up from earlier expectation of 130 bps.

Sun Microsystems (SUNW) took back a sizable chunk of the market for server computer systems used by businesses in the second quarter, according to data from market researcher IDC. The quarterly numbers also point to continued struggles for Dellin server sales, while Advanced Micro Devices. continued to grab more of the market from Intel for chips used in servers.

Microsoft (NASDAQ:MSFT), seeking a bigger share of the online advertising market, signed an agreement to show sponsored links and graphical display ads on the Facebook friend finder site. Facebook will use Microsoft's AdCenter software to show ads to its more than 9 million users. The agreement is a win for Microsoft, which lost out to Google (NASDAQ:GOOG) in similar agreements with News Corp.'s MySpace.com (NASDAQ:NWS) and Time Warner's AOL (NYSE:TWX).

Rambus (NASDAQ:RMBS) lost a ruling in its patent dispute with Hynix Semiconductor, delaying until at least February the final phase of the case until the U.S. Federal Trade Commission issues its penalty in an antitrust lawsuit against Rambus. The FTC ruled Aug. 2 that Rambus engaged in "deceptive conduct'' in order to control patents for high-speed computer memory chips.

International Business Machines (NYSE:IBM), the world's largest provider of computer services, agreed to buy Internet Security Systems Inc. (ISSX) for about $1.3 billion in cash. Internet Security shareholders will receive $28 a share, the companies said today in a statement distributed by Business Wire.

Source: Rob Black's Tech Stock Report