Tushar,
Good work, I agree that Amortization of goodwill and other acquisition-related intangibles and Purchased in-process research and development are a part of reported "other" loss from operations. Assuming that all of those operating expenses are an "other" burden, that means "other" lost ~$.44 per dollar sold, rather than ~$1.04 per dollar sold. That's assuming you feel comfortable disregarding those expenses.
The problem is that the markets tend to go by the reported earnings, including the expenses. So where IAG earned ~ $.22 per share, "other" lost ~($.19) per Intel share (on about 19% of the business). Take that out to a PE multiple, and it may just be significant to the stock price.
re: This is OK but the problem was that Intel (and everybody else) bought companies in the bubble era when valuation of these intangibles reached great heights.
Well, not "everybody else". I seem to remember the words "acquisition" and "accretive" used in the same sentence.
The bottom line is that Mr. Barrett's wild spending spree has cost shareholders dearly. And the trend is clearly towards further deterioration, maybe an overall Intel loss this quarter. How long has it been since Intel posted a loss for the quarter? As an independent company, "other" would be out of business, with or without goodwill and R&D.
The Barrett strategy is currently a failure. And it sure looks like the longer it continues, the worse it will be for the company.
I'm concerned. I guess you're not?
John |
