Proving the rule that large mergers rarely work out as planned, computer chip giant Advanced Micro Devices (NYSE: AMD) will write down $880 million of the purchase cost of graphic chip giant ATI, the company AMD bought over a year ago. Add that to the fact that AMD's product delays have cost it market share, and you can be sure that competitor Intel Corp. (NASDAQ: INTC) has been singing a happy tune lately.

AMD is expected to take $32 million in restructuring costs due to employee severance costs resulting from last September's job cuts, and record a loss of $0.52 per share on revenue of $1.45 billion come tomorrow's earnings release. This would be in line with analyst expectations, but at the same time, may not please investors much. AMD management is also expected to give conservative guidance for the current quarter due to soft seasonality and the overall U.S. economic environment, since so many of its products are consumed here.

AMD really needs to get out a price competitive, cutting-edge processing chip for the laptop PC that can compete with Intel's Core 2 Duo product and the Centrino wireless offering. Laptops are the hottest PC category and AMD is letting Intel have all the fun. Its current dual-core chip lineup just can't compete and requires too much energy to operate. I hope analysts nail down AMD's exact road map and time lines for these products, which it needs if it expects to be competitive at all during the remainder of 2008. Right now, it's not even close.