AMD aims to reverse market share slide in '07

By Sheena Lee and Sophie Taylor

TAIPEI (Reuters) - Advanced Micro Devices Inc. (AMD) (AMD.N), the world's second-largest maker of computer microprocessors, said on Tuesday it expects its declining market share to bottom out and return to an upward trend by the end of the year.

AMD has steadily lost share to Intel Corp. (INTC.O) over the last half year in the $40 billion PC processor industry, after making strong gains against its better-known rival before that.

"Sometime in 2007 you'll see us resume a more robust market share. You'll see us rebound for sure," Henri Richard, executive vice president and chief sales and marketing officer, told Reuters at Computex, the world's second-largest computer show.

Intel controlled 80.2 percent of the global microprocessor market in the first quarter of 2007, up 4.5 percentage points from 75.7 percent in the fourth quarter of 2006, according to research firm iSuppli Corp.

AMD's market share fell 4.6 percentage points to 11.1 percent over the same period, iSuppli said.

With a market capitalization of about $7.9 billion, AMD in April posted a first-quarter net loss of $611 million, falling from a profit of $184.5 million in the same period a year ago.

AMD will likely post revenue of around T$1.24 billion for the second quarter, slightly above T$1.21 billion a year ago, according to Reuters Estimates.

Competing aggressively with chip giant Intel, AMD said it planned to raise capital and that it was open to private equity investments, but no specific names were given.

"We need to improve our balance sheet," said Richard, adding that the processor speed of new products was sometimes not as relevant as reliability and ease of use.

AMD's U.S.-listed shares fell 0.98 percent on Monday to $14.17, compared with Intel's 0.89 percent decline. The shares lagged the 0.17 percent rise in the tech-heavy Nasdaq .IXIC.