And the big bet that AMD made by acquiring graphics-chip maker ATI for $5.4 billion in 2006 has yet to prove its worth. The first real fruits of the union aren't due until 2009, when AMD releases its so-called Fusion processor, which integrates computer processing and graphics acceleration on a single chip.

In the meantime, the rich -- some say excessive -- price that AMD paid for ATI has saddled the company with massive debt and restructuring charges at a time when profit margins are being squeezed by competition with Intel.

In the last three quarters, AMD lost roughly $1.6 billion combined -- and it's not clear when the company will return to break-even.

Still, the surest formula for a change may not involve Meyer replacing Ruiz: both men are part of the current management team and are said to have equally favored the ATI acquisition.

Ruiz also may be unwilling to end his term on a low note.

"Hector is a guy that loves to fight. He's not going to retire on a downturn," says the source.

As Ruiz soldiers on, all eyes will be on his presentation to analysts next month, where the CEO will bear a heavy burden to articulate a cogent comeback plan.

Among the most pressing questions are AMD's manufacturing strategy and its ugly balance sheet, say analysts.

AMD has been tight-lipped about details to outsource more of its chip fabrication to third-party manufacturers, even as it claims to be moving forward with the plan.

Given how central the project is to the company's finances, investors may not be willing to give AMD the benefit of the doubt much longer without seeing signs of progress.

Ruiz has earned the Street's trust with his past performance. But the future will hinge on results.

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