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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 203.14

-0.8%

Jan 9 9:30 AM EST

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To: andreas_wonisch who wrote (59257)	10/19/2001 11:22:39 AM
From: Bill Jackson	Read Replies (2) of 275872

Andreas, The cost of one more die in all those steps is quite low. The new package is about $14-16 and the freight is less than $1 for all these stages as they are fairly light(except retail pack as that is bulky as well as costly) if they get 250 dice from a wafer and the wafer costs them 5,000 that is $20 each. The rest of costs are fixed costs, resaearch etc that do not change with production volumes. This marginal cost is less than $60. Memory makers are selling ram for less than marginal cost to try to keep volume and be the last man standing. that is why there is such an aggravation at the Korean governments/banks propping up Hynix while Micron burns cash. Right now AMD is indeed losing money and can afford this for no more than 4 years at this rate(at which point it will have run it's debts back up to where they were a few years ago) The gross cost with all factors in is the 7.7 million into the revenue from CPUs(flash out). On that basis AMD lost money. Bill

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