WDC/Sandisk Corporation Message Board

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Technology Stocks : WDC/Sandisk Corporation

WDC 163.26

+3.5%

Nov 28 12:59 PM EST

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To: Artslaw who wrote (21287)	12/10/2001 6:45:14 PM
From: Ausdauer	Read Replies (1) of 60323

Steve, yes, I think they will try to target profitability in the next several quarters. It may be like trying to turn around a cruise ship at this point given the fact that the scale of operations has changed so dramatically after abandoning the fabless model of production. I hope that it won't take two years in reality. I didn't interpret the Merrill Lynch report as bullish either, nor do I have the sense there is any impending change in business. Eli stated Q4 would probably be the nadir for SNDK during the last c.c. I am not sure when margins will return to positive territory given the competitiveness of the market at present. I share the same fear as you do. There just doesn't seem to be a bottom in card pricing. The Merrill Report was confusing in that it mentioned increasing gross margins, while at the same time underscoring the burden of fixed costs for running Dominion. I read somewhere that mass adoption won't occur until card prices are less than $10.00 a piece, or something like that. This is the price point where people don't mind dropping a card off at a film developer or swapping cards with a friend. I guess it is the same price point where Iomega 100MB Zip discs really took off. I do see believe the MP3 market will make a comeback as flash prices continue to fall. It will be interesting to see what happens over the next few months. Eli said that MP3 was pulseless at this point given the lingering security issues. I also think 64 or even 128 MB of flash pales in comparison to a several hundred MB CD-RW diskette or a multiple gigabyte portable hard drive. But we are slowly gaining on them. Aus

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