AmTech Welcomes AMD's Cost-Cutting, Lehman Concerned with Declining Market Share

4/8 - "Analyst Doug Freedman of American Technology Research welcomed AMD's cost-cutting news. "AMD hasn't been efficient with the workforce it has," he says. "I don't think this cut will be material to its ability to be effective. It will emerge leaner and meaner. We saw what this did at Intel after it started cutting jobs that amounted to 20% of head count." Freedman rates AMD stock a buy with a price target of $10.

Earlier in the day, before AMD's announcement, Lehman Brothers (LEH) analyst Tim Luke said in a research note he expects AMD's share in the PC and server microprocessor market to fall by 1.5%, worse than the previously expected drop of 1%. Luke said that Intel has been increasingly competitive in both servers and "value" desktop PCs—that is, those in the lower price ranges—market segments where AMD had made gains against Intel during the prior two or three years.

A weaker outlook for U.S. consumer spending has only hurt AMD's results further, Luke wrote."