Though wise men at their end know dark is right,
Because their words had forked no lightning they
Do not go gentle into that good night.
Good men, the last wave by, crying how bright
Their frail deeds might have danced in a green bay,
Rage, rage against the dying of the light.

-- "Do Not Go Gentle Into That Good Night,"
Dylan Thomas

If you needed some proof that Intel (NASDAQ:INTC) holds the chip performance lead today, at least in the hearts and minds of its customers, you've got it in this earnings report. Intel sure isn't going gentle into the night, but I haven't seen much rage against the darkness out of its rival lately. Enjoy National Poetry Month while it lasts, by the way.

In the words of CEO Paul Otellini, Intel's product strength "is reflected in the fact that average selling prices for the quarter held up well in a very competitive environment." The gravitas of this statement is magnified by AMD (NYSE:AMD) saying that its revenue stream is suffering from significantly lower pricing on top of lower unit volumes.

You want more? OK, look at the inventory breakdown. Intel's finished goods stock is down sequentially as old product lines are cleared out with some aggressive price cuts. Yeah, the price war slices both ways, but remember the stable gross margins. The higher-end processors are not clogging up the works by not selling at their higher price points. And meanwhile, raw materials and work in progress balances are building up, as Intel ramps up production on its brand-new 45nm manufacturing processes. Those chips, codenamed Penryn, are hitting the street in the second half of 2007.

Intel's restructuring is also running ahead of schedule, and management says that the company has reached the targeted staffing level of about 92,000 employees a full quarter ahead of schedule. The good news just keeps on rolling in, doesn't it?

Oh, but it gets better still. As an AMD shareholder, it's somewhat discouraging to report that Intel is now doing all the things that attracted me to AMD in the first place. You might expect a lower R&D budget, for instance, now that the headcount has shrunk a bit. And yes, we were originally told to expect $5.4 billion in research expenses this year, down from $5.9 billion last year. Now that figure is nudging northward again, at about $5.6 billion.

The earnings call closed with an epic teaser. "Intel's R&D pipeline extends many years into the future," said Otellini, "and we have much to share with you on at our upcoming Analyst Meeting." That's in about two weeks.

So, Intel acknowledges that AMD is offering serious competition and planning accordingly, with increased R&D commitments and a long-term vision. That's all good stuff. Tonight, we'll hear AMD's side of the story. Will it be a strong rebuttal, or tantamount to an unqualified surrender? The truth probably lies between these extremes, but I'm a nervous AMD owner today.

Further Foolishness:

Intel is a Motley Fool Inside Value selection.

Fool contributor Anders Bylund is an AMD shareholder but holds no other position in any of the companies discussed here. You can check out Anders' holdings if you like, and Foolish disclosure will indeed rage, rage against the dying of the light.