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Technology Stocks : Intel Corporation (INTC)

INTC 36.85

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10:43 AM EST

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To: Dan3 who wrote (145484)	10/16/2001 10:55:31 PM
From: ptanner	Read Replies (1) of 186894

Dan3, Re: "In order to show a loss that small, they've had to inflate the undepreciated value of their plant from $13,414 Million to $18,138 Million - a difference of another $4.7 Billion." I don't believe this is true. The far more likely answer to the increase in "Property, plant and equipment, net" is Intel's aggressive rate of capital investment which exceeds the depreciation of existing equipment. The change reflects prior quarter total + capital expenditure - depreciation. The depreciation rate is about 6%/quarter or an average asset life of a little over four years (of course some classes of capital investment have shorter or much longer lifetimes). I don't see a conspiracy here. Re: "If they'd been accounting for the depreciation of their plant investment to keep it level (the way AMD does)" The fact that AMD's capital investment has roughly matched its depreciation is coincidence. Intel is not just replacing its facilities but expanding and enhancing its capacity. -PT

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