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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 214.11

+3.9%

3:59 PM EST

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To: Road Walker who wrote (17465)	11/2/2000 9:13:32 PM
From: Charles R	Read Replies (1) of 275872

John, <The biggest problem, in my opinion, is that Intel is losing money on that growing portion of their business.> I think it is largely accounting gimmicks. If you go back to the presentation you would hear a mention that the networking communications part of it is profitable. (I believe Andy Bryant or Craig said that while doing the business update but I am not sure). Which should make people pause and think: if flash is highly profitable, networking is profitable where are those losses coming from? <It's eating up the profits from IAG (and Intel Capital), total profits (and share price) would be significantly higher if it were not for "other". If they can't turn those segments to profitability, thing will get nasty in a year or two, as "other" grows to a larger portion of the total business.> Other than Internet business center stuff I do not believe there are any major money losers at Intel. Remember that the so called "growth" in the communication segments for Intel has come from acquisitions (i.e., bogus growth financed with IABG profits). One accounting possibility is that Intel is writing off the goodwill from its acquisitions and that is causing those "losses"; the other possibility is that the losses do not belong there. Or, it could be a combination of both. Since Intel doesn't breakdown numbers intentionally (Andy said as much in response to a question) one will never know. <Right now I look at "other" as being about 60% risk and 40% potential. > More like 90% and 10% in my view but I have always been a sceptic of growth through diversification. In Intel's case one would be hard pressed to find a single acquisition that has gone well in the last couple of years. Chuck

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