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Technology Stocks : Intel Corporation (INTC)
INTC 36.15-0.6%Dec 24 12:59 PM EST
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To: Dan3 who wrote (136878)6/7/2001 1:38:10 PM
From: D.J.Smyth  Read Replies (1) of 186894
 
dan3

"20% growth times .85 (after this years decline), just about equals 1. So 2002 sales are estimated to be about the same as 2000 sales. But there will have been a huge increase in FAB capacity over that period, so the 25% growth in 2003 would do little or nothing to help margins."

revenue growth and unit growth should be separated. a "huge" 30% growth or increase in FAB capacity will be coming on line toward the end of this year and through 2003.

if it costs $.80 to build where $1 was previously spent, I only need to sell 10% more units to increase profits if unit receipts, per $1, have also dropped but 10%. so, profit from flat revenue is relative to unit costs, the increase in the number of units sold, and revenue per unit.

even in a flat revenue environment, INTC builds is cash war chest by another 10%; not to mention what happens in an increasing revenue environment. INTC will remain and increase its cash riches.
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