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Technology Stocks : Intel Corporation (INTC)
INTC 36.21+0.2%3:59 PM EST
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To: The Duke of URL© who wrote (163684)4/8/2002 11:59:34 AM
From: Ali Chen  Read Replies (2) of 186894
 
Duke, you say: "A "trick" is [...] to reduce costs which may mislead the share holders to give the impression that the gross has continued to expand."

Writing off ridiculous amounts of money into "other"
category is a trick by your own definition, since the
label "other" has a flavor of being "insignificant",
and thus creates a false impression that the core business
is still doing well, which is highly questionable in the
current market situation and price war.

Also, you stressed: "to reduce costs". As you might be
aware, significant part of business costs is the cost
of labor. Stock options constitute significant part
of Intel's benefit package, and the cost of maintaining
those benefit structures is known - $1 billion per quarter
to buy back the stock - over the last two years at least.
Yet these expenses are not included into reported
cost of doing business. Therefore, the cost is
grossly reduced, so the EPS are misleadingly inflated,
which completely falls under your own
definition of accounting "tricks".

The reported Intel's EPS are so inflated that create
an impression that they are positive, while the real
EPS are negative during the last few quarters. Now tell
me how deeply mislead must be investors in this case ;-)

- Ali
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