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SAN FRANCISCO--Shaking off an industry-wide slump in the semiconductor market, Advanced Micro Devices (AMD) is keeping up with technology advances made by its fiercest competitor, Intel, and is on track to meet expectations this quarter, according to the company's finance chief.

Presenting a snapshot of the company's goals at the Robertson Stephens Technology Conference here, AMD's Chief Financial Officer Robert Rivet Wednesday pledged a return to profitability in the second half of the year. He based his expectation on the company's growing worldwide market share in both revenue and units shipped.

Net sales for the first quarter are expected to come in at roughly $900 million, with a small loss in earnings per share, Rivet said. Revenue will be slightly down from the fourth quarter of last year but in line with typical seasonal trends, Rivet said.

Meanwhile, according to Rivet, the company continues to keep pace with its competitors as it develops new chip technology for small computing devices, PCs, and servers.

"We do not see the competition pulling away from us," Rivet said, speaking Wednesday as Intel hosted its annual developer forum just blocks away. At the forum, Intel announced its new technologies for servers and other computing devices.

Thinking Mobile

AMD is banking on its new Athlon line of chips, which Rivet said has so far competed successfully against Intel's Pentium 4 processor. The company is also looking ahead to its new 64-bit Hammer processor, which debuted here this week.

In March, the company will have an Athlon chip running at the equivalent of 1.5 GHz for notebook computers. A 2-GHz desktop Athlon chip is expected to arrive a month later. In the second quarter of this year, AMD plans to begin shipping a 2.4-GHz version of the Hammer, ramping up its performance in 2003.

Meanwhile, at its developer forum, Intel has announced that it expects a 1.6-GHz version of its Pentium 4 chip for laptops to come out in early March, ramping it up to 2 GHz by year's end.

"AMD's road map keeps it pretty much neck and neck with Intel," said Eric Rothdeutsch, a managing director of semiconductor research at investment bank Robertson Stephens.

With the semiconductor industry in a rut, as revenue generated in the overall chip market fell collectively by more than 30 percent in 2001, both Intel and AMD will have to advance their lines of chips in anticipation of an upswing in the IT industry, which so far few analysts or industry executives are brave enough to predict.

Rebound Opportunity

Sales of flash memory products, whose main use in the market is for portable and consumer electronics, has hit bottom, Rivet estimated. "The flash business is low; but if you look at it long-term, it is definitely a place to be," he said.

AMD derives roughly 30 percent of its revenue from the sale of flash-memory products, Robertson Stephens reports.

PC sales might rebound later this year as IT departments purchase new, speedier machines, according to Robertson Stephens market research. Analysts said sales of mobile computing devices such as cell phones are expected to rise, too, boosting sales for chip makers that target that market. "We do think the worst is behind the economy," Rothdeutsch said. "The semiconductor inventories are being corrected, and IT spending is flat but positioned for a return."

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