Good And Bad News For AMD - Page 2

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Even with its troubles, AMD isn't losing OEM support, according to McCarron. "I don't think you will see OEMs abandoning AMD," he said. "The issue really relates to mix. A Dell or HP or Lenovo has product lines with both [Intel and AMD processors] and can choose which they promote more. They want AMD around."

The question then becomes will CEO Hector Ruiz survive? He signed a five-year contract with AMD when he took the helm as CEO in 2002 and is now on a year-to-year renewal basis, which automatically renewed for 2008 this past December. He has the option to leave, and the board has the option to terminate his contract with 90 days notice on both sides.

Spooner said it could be tough for AMD to let him go because Ruiz handles the company's relationships with its top clients. "He serves as their salesman-in-chief some times. He's really important in terms of making sure AMD has relations with its top customers like HP. It's tough to take AMD's failure on the technical side and place it completely on him," he said.

But one more bad quarter, and investors are going to speak up. Spooner noted that Kevin Rollins was pushed out of Dell, that Chairman Michael Dell didn't want him to leave, and it could happen here, too.