WDC/Sandisk Corporation Message Board

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Technology Stocks : WDC/Sandisk Corporation

WDC 187.70

+9.0%

Jan 2 9:30 AM EST

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To: Robert Douglas who wrote (26385)	7/15/2004 12:19:01 PM
From: Pam	Read Replies (1) of 60323

Hi Robert, Not so fast. We still haven't seen the excess supplies yet. Sandisk is trying to address the excess supplies even before that happens. We will have to wait and see how much MU, STM/Hynix, Infineon and Renesas are going to produce. All have some great plans to begin significant production. Also, Sandisk said they will be cutting prices again this quarter, similar to what they did last quarter to create tight supplies going into the 4th quarter. By the way, they have already factored in the price-cuts and yet their GMs guidance looks good. The rev guidance is a bit conservative to be on the safe-side. In my opinion they will easily exceed 460mm next q. It's amazing, they haven't even marketed their flash drives outside of USA. That will be a big market the next two quarters with the 4Gbit chips coming into production. One thing that I noticed is that lic/royalty income was flat q over q, which means for their competition it was a flat quarter with Sandisk stealing away market-share. Any comments on how else would one interpret flat lic/royalty inc (besides some impact from royalty inc based on sales value which has a tendency to go down with falling prices)? Was Flash market moderating last q or just because of lower prices we didn't see that much gowth? -Pam

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