AMD To Face The Heat At Analyst Meeting

One has to expect AMD officials will be in damage-control mode when faced with some of the following questions arising from news cycles that have treated the company less than charitably of late:

How did you botch the Barcelona ramp so badly? AMD launched its first quad-core Opteron processors to great fanfare on Sept. 10. But we heard rumblings of a supply crisis from channel partners in early October. Those rumblings turned into a roar last Wednesday when it was reported that AMD had ordered a 'stop ship' on all Barcelona processors. That turned out to be an overstatement -- AMD continues to ship quad-core Opterons in quantity to a few select partners building HPC clusters -- but the chipmaker also admitted that a glitch discovered on its new chip had pushed a high-volume roll-out to the first quarter of next year.

AMD clearly did the right thing by not shipping a buggy chip into the wild, but the question remains how they can justify raising partner expectations (not to mention delaying big contracts) with such a splashy launch party.

When can you possibly turn this ship around? It's difficult to see how executives can avoid questions about the state of the company following several quarters in the red and the possibility of more given the Barcelona debacle.

Meanwhile, there are questions about what the 8.1 percent stake of AMD purchased by Abu Dhabi's Mubdala Development means going forward.

Is CEO Hector Ruiz in or out? Rumors have been swirling about the situation at the top of AMD's executive food chain, given all the bad news the company has been receiving lately. Now it's being reported that Ruiz told CNBC Europe that Dirk Meyer, AMD's president and COO, is "being groomed to succeed him," though in the same interview Ruiz apparently said he has no plans to step down as CEO.

And what's with the Iranian supercomputer, anyway? In a story that's just picking up steam, Iranian scientists claim they built their country's most powerful supercomputer with 216 Opteron microprocessors made by AMD. This despite exports of computer equipment to Iran being banned under U.S. sanctions against that country.

AMD denies any involvement in the construction of the Iranian supercomputer, stating that, "AMD fully complies with all United States export control laws, and all authorized distributors of AMD products have contractually committed to AMD that they will do the same with respect to their sales and shipments of AMD products on the export of U.S. computer equipment to the Middle Eastern nation."

Regardless of whether AMD is found innocent on all charges, it's a story that the chipmaker had to wince at when it started gaining traction Tuesday, adding yet more mud to what's shaping up as a very miserable December in Sunnyvale and Austin.

UPDATE: Against all odds, it looks like things have actually gotten worse for AMD ahead of Thursday's analyst meeting. The chipmaker on Wednesday disclosed an SEC filing which states that on Dec. 6, AMD "concluded that the current carrying value of its goodwill which the Company had recorded as a result of its October 2006 acquisition of ATI Technologies Inc. was impaired."

AMD expects a "material" impairment charge, but can't "in good faith" estimate how big the charge will be.