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Technology Stocks : Dell Technologies Inc.
DELL 138.940.0%Dec 5 9:30 AM EST
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To: stockman_scott who wrote (160165)8/29/2000 7:52:34 PM
From: rudedog   of 176387
 
Scott - that is a difficult question, and certainly a hot topic on the less refined boards - there are about 50 posts a day on Yahoo advocating that position.

As far as I can tell, DELL is not having any problems with their mainstream chips for desktops. They are probably suffering the same constraints around the big Xeon processors as everyone else, although this will have less effect on DELL's unit volume as they sell more in the 1 and 2 processor space as a percentage of their mix.

DELL has benefited from a unique engineering and business relationship with Intel, which has allowed them to maintain a 1.5% R&D model - so the value of that close relationship is probably in the hundreds of millions annually.

I don't currently see any supply problems that represent that kind of hit - since those R&D costs are from margin dollars, DELL would have to see a billion dollar benefit.

Of course, it is always possible that DELL could have their cake and eat it too, but I doubt that. CPQ has nowhere near the kind of relationship with Intel that DELL enjoys, despite spending more money as an Intel customer. Why should Intel reward people who support Intel competition if they don't have to do so?
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