Dan,
Capex is running $7.5 Billion per year, and Intel sells about 120 million CPUs per year, so I get capex costs of $62 per chip. Two years ago, they were selling about the same number of chips, at a $200 ASP, and capex costs were half what they are now. Now capex costs are way up and ASPs are below $150 and dropping fast.
One thing, you are trying to "expense" intel's capex costs. Whenever a company adds Plant, Property and Equipment, instead of being "expensed", it is "depreciated" over the PP&E's life.
Therefore, assume a 5 year life of the 7.5B Capex. That's 1.5B/year and divide that by 120M chips. Division tells me about $12/chip for depreciation.
Also, due to "pro-forma" Income Statements, some companies only report "cash earnings" and exclude Depreciation/Amortization, and that's how analysts get their numbers.... |
