Semi-Equips - Buy when BLOOD is running in the streets! Message Board

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Technology Stocks : Semi-Equips - Buy when BLOOD is running in the streets!

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To: Clarksterh who wrote (3873)	12/17/1997 9:50:00 AM
From: Jay M. Harris	Read Replies (2) of 10921

Clark; Microns blended average ASP was $3.60 for a 16 meg die in the most recent quarter. This was down 44% from $6.50 in the prior quarter, and 58% from $8.25 the preceeding quarter. Micron enjoys a 10 to 15% price premium at major box OEMs (Compaq & Dell). Micron is currently at .3 micron process technology with fewer masking steps than any other DRAM supplier. Hence, the smallest 16 meg SDRAM in the world (70% of parts next quarter)! Micron broke- even at $3.60 ASP's. Currently, every $.01 cent decline in 16 meg ASP is shaving $.01 in MU fiscal 98 eps. Current 16 meg ASPs are at $2.5 to $3.20 for SDRAM. Hence, at prevailing prices MU is already losing money with a 15% premium over all other DRAM suppliers. Clark; would you buy bonds of Fabs operating at a loss to fund .25 Micron capacity, hence, doubling the supply of SDRAM at todays and possibly lower prices? What interest rate would you accept? My point is, that financing for this activity is drying up! Orders for equipment will be pushed out at the very least and probably canciled. Regards, Jay

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