Formerly About Applied Materials Message Board

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Politics : Formerly About Applied Materials

AMAT 327.01

+2.5%

Jan 16 9:30 AM EST

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To: Pink Minion who wrote (45644)	4/20/2001 6:14:16 PM
From: Cary Salsberg	Read Replies (2) of 70976

Merrill Lynch said that they subtracted 12 month's of projected sales' requirements from current inventory and concluded that the remainder would be obsolete in 12 months and should be written off today. Merrill thought the chips would find other usage and the writeoff will not help comm semi companies. CSCO will use the inventory if they can and, per Merrill, sell what they can't. If they use it, it can't contribute to cost of goods sold, an expense, because it was expensed once in the writeoff. Similarly, if they sell it, it has a zero cost basis and the whole sale price is taxable income.

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