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As someone who doesn't follow CPU manufacturers closely, it is still surprising to me AMD is in a tough spot - don't their CPUs power a huge portion of commodity hardware based cloud servers like AWS and Rackspace cloud? It seems like demand for that space is huge and only going to grow.

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There was a piece at AnandTech recently that summarised Intel's very successful business model as selling lots of low-margin chips to consumers to ensure reaching the right economies of scale, and then making money on high-margin enterprise versions of the same chips. If that's right, and AMD only succeeds at selling lots of the latter, they still have a problem because without those economies of scale the high-margins don't come through either.

They also have CPUs and GPUs in most of the next generation games consoles.

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