Advanced Micro Devices - Moderated (AMD) Message Board

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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 214.96

+5.5%

3:59 PM EST

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To: Paul Engel who wrote (1488)	7/20/2000 12:23:25 AM
From: Steve Porter	Read Replies (1) of 275872

Paul: It's really simple. Everyone INCLUDING analysts made estimates based on a 0% tax rate. AMD voluntarily took a 20% tax rate this quarter. Therefore all the estimates were expecting a 0% and are therefore comparable to pretax earnings. That said, AMD is paying taxes from here on out, and all FUTURE estimates will need to be adjusted to take this into account. A further point is that you are correct that AMDs retained earnings for this quarter are $1.21. However, we aren't talking about their retained earnings, but rather earnings vs. estimates, and since earnings were taxed and the estimates not, it's not a fair comparison. Steve

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