Don't forget to include in your Q4 earnings calculations $35.6 million of premiums paid for early conversion of some of their convertible notes, which is around $0.10 per share. That's pre-tax, but do they pay income tax? From recent SEC filings:
"On October 22, 2004, the Company exchanged $70 million of its 4.50% Convertible Senior Notes due 2007 (the 4.50% Notes), plus accrued and unpaid interest, for 10,550,000 shares of its common stock. On November 3, 2004, the Company agreed to exchange $60 million of its 4.50% Notes for 8,748,612 shares of its common stock that it expects to settle on November 8, 2004...As a result of these transactions, the Company expects to recognize an expense of approximately $26 million during the fourth quarter of 2004 equal to the fair value of the shares issued in the transactions in excess of the fair value of shares issuable pursuant to the original conversion terms of the 4.50% Notes.
"On November 15, 2004, Advanced Micro Devices, Inc. (the 'Company') agreed with a holder of its 4.50% Convertible Senior Notes due 2007 (the '4.50% Notes') to exchange $44.0 million of its 4.50% Notes for 6,267,149 shares of its Common Stock. On November 15, 2004, the Company agreed with another holder of its 4.50% Notes to exchange $27.0 million of its 4.50% Notes for 3,825,500 shares of its Common Stock. The Company expects these transactions to settle on November 18, 2004...As a result of these transactions, the Company expects to recognize a non-cash charge of approximately $9.6 million during the fourth quarter of 2004 equal to the fair value of the shares of Common Stock issued in the transactions in excess of the fair value of the shares of Common Stock issuable pursuant to the original conversion terms of the 4.50% Notes."
So AMD will have a $0.10 nonrecurring expense for conversion sweeteners and Intel will have a $0.10 write-off for its ICG (Impairment Chore Gigabuck). |
