AMD Gains Legal Upper Hand Against Intel -- 'Chip Market is Global'

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 |  Includes: AMD, INTC
by: SA Editors

Advanced Micro Devices announced a "significant legal victory" yesterday when Intel was ordered to produce evidence from its foreign operations as part of the discovery process in their antitrust suit case. A Special Master informed the presiding judge on the 15th that the "... undisputed geographic market (for x86 microprocessors) is global ..." with approx. 68% of global sales to non-U.S. customers and therefore, "... evidence of foreign exclusionary conduct is essential for AMD to demonstrate" Intel violated U.S. antitrust laws. AMD-INTC-1yr-chart-12-28-06 AMD's executive VP commented, "We will proceed vigorously to prove that Intel abuses its global monopoly power by limiting or excluding competition, which ultimately hurts consumers worldwide." Intel said in a letter to the judge that it will comply with the order. However, Intel noted the Special Master did not decide whether any evidence would be admissible at trial, which is expected to begin Apr. '09, and said it "... plans to raise evidentiary issues with the court at a later date." The news didn't help shares of AMD, which closed lower by 0.63% at $20.57, while Intel gained 0.10% to close at $20.42.

• Sources: Press release, MarketWatch,SF Chronicle
• Related commentary: Intel Beware: AMD Expects Greater Market Share in 2007, AMD Subpoenaed By DoJ; Unveils New Processor Family, ATR: AMD's Facing A Challenging Q4, AMD Bears Continue To Emerge Conference call transcripts: AMD Q3'06, Intel Q3'06
• Potentially impacted stocks and ETFs: Advanced Micro Devices (NASDAQ:AMD), Intel (NASDAQ:INTC). ETFs: Semiconductor HOLDRs (NYSEARCA:SMH), iShares Goldman Sachs Semiconductor (IGW)

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