niceguy767,
AMD clearly stated that they will increase flash production year-over-year by 70% in terms of the number of bits shipped. As I remember, they said nothing about increasing revenue by 70%. I was very bothered by the way that they decided to present the information. If a company company sells 1 million units of 16 Mbit flash in one quarter, and then ships l million units of 32 Mbit flash in the next year quarter, it is very likely that the price of the chips is about the same (revenue generated the same), while the number of bits shipped has grown by 100%. In itself, I fail to see how a 70% increase in bits shipped, year-over-year, is very positive at all. Now, having said that, the news of bring three additional fabs online around the middle of next year is very encouraging. My guess would be the following: With a $250 million run rate this quarter, I would say 275 million in q1, 300 million in q2, 400 million in q3 (with new fabs ramping), and 500 million in q4, for a total in 2000 of about 1.5 billion. 2 billion would be great, but I would not count on it.
Now, in q4 of 2000, add 6 million Athlons (of all flavors) at an ASP of $200 ($1.20 billion; Willamette induced price pressure), 3 million K6-X (due to unit shipment competition from VIA) at $50 ($150 million), and 200 million com plus misc, you get about 1.55 billion in q4 revenue. With about $1.05 billion in costs, and about 200 million share (by then), I would guess roughly $2.50 in profit. Given a PE multiple of 25, the share price extrapolates to about $250 per share.
Pravin. |
