WDC/Sandisk Corporation Message Board

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Technology Stocks : WDC/Sandisk Corporation

WDC 221.51

-0.3%

Jan 16 9:30 AM EST

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To: Pam who wrote (26967)	11/17/2004 1:10:48 PM
From: Art Bechhoefer	Read Replies (1) of 60323

Pam, it's difficult to find a segmentation of Samsung profits and to know whether its flash memory business is doing anything other than generating revenue at the expense of profits. The Samsung policy is well understood by now: Lower prices, no matter what, in the hope that competitors will be discouraged and finally will give up. It's also difficult to know exactly what portion of SNDK revenues came from wafers purchased from Samsung, and whether in the current and future quarters there will be less purchasing of Samsung product by SanDisk. In theory, SNDK margins should go up if they are able to meet their product needs from their own manufacturing. In theory, SNDK profit margins should deteriorate less if they are buying less from Samsung. I now find it impossible to predict earnings per share because of all these changes, including the calling of the convertible issue. The only certainty is that SanDisk has a fairly strong balance sheet, including positive cash flow. It's not too bad a situation for the current economic climate. Art

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