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Technology Stocks : Semi Equipment Analysis

SOXX 312.18

-0.2%

Dec 9 4:00 PM EST

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To: Sam who wrote (84950)	4/24/2020 9:57:20 PM
From: Elroy	Read Replies (1) of 95546

They aren't big enough in NAND, don't have economy of size that the other major vendors have. An analyst friend tells me the same thing. He says 7% of INTC's sales is NAND, and they lose money on it. I guess it makes sense for them to sell to MU. Or.....acquire MU outright. Either of those seems like a decent idea. A bit hard to understand the economies of scale argument. Is running six fabs really that much less expensive that running one fab? I would think the major cost is in building the actual fab, and not in paying the HR or accounting/marketing staff that do the post-construction memory sales business. What does INTC lack that Samsung has - the ability to leverage chip marketing staff across multiple fabs? Maybe, but I didn't think manpower was such a big NAND maker expense - I thought it was capital equipment. Do you know what was the reason INTC got into the NAND chip making business in the first place? I know they partnered with MU and shared output, but why did INTC originally want to do that? Maybe MU was going bust, and INTC wanted to keep a supplier alive?

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