Advanced Micro Devices - Moderated (AMD) Message Board

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Technology Stocks : Advanced Micro Devices - Moderated (AMD)

AMD 214.53

-0.3%

11:56 AM EST

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From: niceguy767	4/20/2005 8:31:06 AM
	Read Replies (2) of 275872

Now let's look at comparative depreciation. Further to the PP%E issue raised here: Message 21245892 has anyone noticed that INTC's deprciation was $1.2B vs. AMD. 0.4B. INTC took 3 times AMD's depreciation charge. The respective bases are an INTC PP&E $16.3B and $4.3B. Despite an INTC PP&E that is 3.8 that of AMD, INTC takes only a depreciation charge that is 3.0 times that of AMD. Were INTC to take a 3.8% depreciation charge on their PP&E base, the additional expenditure to INTC would be $130M. Conversely, AMD's bottom line would have improved by $31M had AMD taken the same (lower)percentage depreciation charge as did INTC. There is no doubt INTC's accountants know how to play the eps game, but it does seem to be at the long term cost of their PP&E accounting practices. It just may be that the amount of depreciation charged is predefined in order to help tailor a predfined eps number.

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