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Technology Stocks : Intel Corporation (INTC)

INTC 36.20

+0.1%

Dec 26 9:30 AM EST

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To: Dave who wrote (154621)	1/10/2002 8:59:12 AM
From: Dan3	Read Replies (1) of 186894

Re: to measure the efficiency of capital investment You used the wrong number for AMD (you used net PP&E for Intel but before ac dep for AMD). Gross PP&E isn't relevant since some of the cost has already been expensed or "used up". Also, there is no question that Intel was doing better last year than they are now. The most recent numbers for net PP&E are; Intel: $18.1 Billion AMD: $2.7 Billion Intel revenues (past 9 months on current 10Q) $19.6 Billion AMD revenues (past 9 months on current 10Q) $2.9 Billion For most of this period, Intel ASPs have been about double AMD ASPs, which should result in about double the revenue for each dollar of Capital available - unless it costs Intel a lot more to produce its chips (in terms of capital) than it costs AMD. For the sake of argument, say Intel produced 27.5 million CPUs last quarter and AMD produced 7.5 million. That works out to Intel needing $670 worth of plant to produce a CPU per quarter while AMD needs $360.

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