Intel Corporation (INTC) Message Board

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Technology Stocks : Intel Corporation (INTC)

INTC 34.32

-1.2%

3:59 PM EST

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To: Road Walker who wrote (128180)	2/23/2001 11:29:20 AM
From: Ali Chen	Read Replies (2) of 186894

"We were having a discussion limited to the cost of manufacturing microprocessors" No we don't. The "cost of manufacturing" is not a well defined term. You can include or exclude anything you want to make up any nice numbers, which does not make any sense. The point you are trying to miss is that this company thinks (and maybe right) that those venture technologies are essential for overall process of being in business of microprocessors, therefore it would be misleading to exclude these costs. For example, it seems that without "Intel Inside" blue-bald morons the Pentiums will not sell that well, no matter how cheap Intel can stamp the chips itself. The cost of raw P-III/Xeons is maybe $20-$30 while the ASP is about $180. Therefore the difference of $2-$3 in raw manufacturing does not matter whatsoever for corporate profits. What does matter for the stock price perspective is the company's overall _cost structure_, which is bloated, as some people tend to believe. IF INtel would spin off all those "moon bean ventures" as Kap said, they may become a "low cost producer". But not now.

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