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Technology Stocks : Intel Corporation (INTC)

INTC 35.10

+2.3%

Nov 19 3:59 PM EST

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To: Road Walker who wrote (128110)	2/22/2001 8:30:35 PM
From: Petz	Read Replies (2) of 186894

John , Intel no longer low cost producer: IAG in 4th quarter: revenue - $6,851 operating profit - $3,317 OK, now if ASP were same as AMD, subtract 34M x $99. (34M estimated CPU's based on AMD's supposed 17% market share, $99 based on AMD $81 ASP vs. Intel $180 ASP, which is Paul Engel's est.) You are left with $49M deficit. Even if you subtract AMD's profit from Flash, AMD CPU division was very profitable selling 7M CPU's at $81. Intel is the high cost producer. And if you read the fine print on Intel's statement, the "All Other" category takes expenses from the entire corporation rather than just the non-CPU businesses. Who knows what IAG's real profits were, but they were certainly less than $3,317 if IAG accounted for its true share of corporate expenses. And they would certainly be LESS THAN ZERO if Intel was selling CPU's for $81. Which means Intel's cost of production was greater than $81 and AMD's cost of production was less than $81. Petz

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