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Politics : Formerly About Advanced Micro Devices
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To: kash johal who wrote (86377)1/10/2000 2:52:00 PM
From: Petz  Read Replies (1) of 1572772
 
kash, more on the Robbie Stevens (Dan Niles) upgrade:
(courtesy, Albert)
Key Points:

** We are raising our revenue estimates for Q4 from $834M to $959M (up 45% q/q) and our EPS from a loss of $0.10 to $0.26 profit. We note that the consensus estimate for the quarter is currently a loss of one cent. We believe that AMD saw a strong surge towards the end of the quarter with microprocessor unit sales of 6M versus our prior forecast of 5.1M. We believe Athlon sales increased to 900K units from about 200K last quarter with Athlon revenues increasing increasing to $248M versus $63M. We believe that ASPs were also higher at $87 versus our $83 forecast. In total, we
believe processor revenues were about $523M up 77% q/q or $100M more than our prior forecast.

** We believe non-processor revenues were also strong driven by flash which increased by 30% q/q to $270M. Q1 flash orders are also strong and pricing remains firm. We believe that total non-processor revenues increased by over 20% q/q to $360M. We believe that total non-processor revenues can
increase by 29% in 2000 driven by flash revenue growth of 52% to $1.2B

** We are raising our EPS estimates for FY00 from $1.00 to $1.50 versus consensus of $1.05. This is driven by a new higher revenue forecast of $4.0B versus our prior forecast of $3.6B. We are now modeling processor units of 23M and $2.17B in revenues for FY00 versus our prior forecast of 18M and $1.87B in revenues. We believe this new forecast is also conservative.

** We are also raising our price target from $35 to $40.
**

RATING: BUY

Comments: they raised their revenue estimate for Q4 by $125M (834M to 959M), but only raised EPS estimate by 0.36 (-0.10 to 0.26). Why? If costs don't increase profit would increase by 0.83. They seem to think there were $70M of additional costs to produce the extra flash and K6-2's, since there Athlon quantity estimate (900K) is very low, and barely above the early Q4 guidance given by AMD.

Petz
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