New AMD CPU retail prices already lower than tray prices

Sunnyvale (CA) – Yesterday, AMD lowered its desktop processor tray prices by up to 26%. These reductions now place their high-end chip 6000+ well under $200. However, the retail picture shows something even more interesting for the people, who are interested in building a dual-core system on a budget : Already today, consumers will find themselves paying even less than the official volume prices.

Browsing though online stores today reveals, that users can order AMD’s 6000+ retailing for $169 ($9 or 5% below the tray price). This lower-price reality exists across nearly all of AMD’s products, which means that the actual price reduction available in the marketplace shows AMD’s official price reductions yesterday are unofficially closer to 30+% for the end consumer.

AMD has a long history of pricing processors at a particular level in-house while actually selling them for less at retail. Intel, on the other hand, typically does the opposite. They list their tray prices at a particular point with almost all products being sold slightly higher at retail.

The ongoing price war between AMD and Intel is really opening up doors for would-be buyers. As this table below shows the impact of AMD’s price reductions have come very quickly for consumers. This table shows the official tray price, average selling price today and yesterday (source : Pricegrabber.com), as well as the lowest price of these processors we were able to find today.

No matter if you like AMD processors or not, or you simply do not care which engine is in your PC, AMD dual-core desktop processors look like an enticing deal right now. You won’t get the most advanced silicon, but enough horsepower to run a decent mainstream desktop PC. It is obvious that it isn’t AMD’s choice to lower its prices for X2 processors ; instead, it is the competitive pressure through Intel which forces AMD to drop its prices in order to hang on to the market shares the company acquired over the past two years.

The Q2 earnings report, due for release on July, will reveal how successfully AMD competed with Intel in the April to June period. So far, AMD has not revised its Q2 outlook issued on April 19, which expected Q2 revenues to be flat or slightly up. In such a case, AMD investors should be ready for another substantial loss, which was $611 million in Q1. The company already took steps to stay afloat in a time of heavy losses and announced on April 27 the release of Convertible Senior Notes priced at $2 billion.