SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : Micron Only Forum
MU 234.19-2.2%Dec 3 3:59 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: mike iles who wrote (24824)12/6/1997 7:31:00 PM
From: DavidG  Read Replies (3) of 53903
 
Mike,

>> Right now, as we speak they have a revenue run-rate
(memory only) of $300M and an operating cost structure of about $390M. This
ain't pretty ... no wonder he's lambasting the Koreans. <<

I am not sure where you got these numbers, but I have a tendency to disagree with them.

First, the $390M operating cost was based on last quarters numbers and you might find a cost reduction in manufacturing the chips which could be as much as 20 - 25% over last quarter possibly reducing the overall operating cost say to $340 million(including R+d and SGA).

Second, I believe the revenue run rate based on 16mb DRAM and SDRAM might be significantly higher right now than you are estimating based on current chip prices. Even if we used AICE, or Smiths and last quarters production we are looking at $350-370m this Q.(asp of 5.00 to 5.25 for mix of DRAM and SDRAM)

Third, I believe MU gained market share at the expense of lower asp and that has to be factored in as well...and I would guess conservatively 10% this quarter, but could have a suprising upside.

Forth, The ratio of DRAM probably changed significantly from last quarter and The SDRAM has higher margins and asp. And I would guess they are conservatively at 50% DRAM right now.

So instead of the $300 sales vs $390m costs I would be looking closer to $525m sales vs $340m at this time.

Of course this is all only guestamates on both our parts but I do not believe you are giving MU too much credit for reducing the costs while improving the revenues thru higher margin products and increased market share. And with the SEA problems it will definiterly improve for MU not get worse.

Good Luck Trading

DavidG
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News