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Technology Stocks : WDC, NAND, NVM, enterprise storage systems, etc.
SNDK 220.51-2.8%Nov 25 3:59 PM EST
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To: Sam who wrote (3439)1/10/2018 10:46:13 AM
From: Sam1 Recommendation

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JCnieuwenj

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So, it is JPM's Harlan Sur v. Bernstein's Mark Newman on the question of Chinese "partners" for Intel (see below). Personally, I find it hard to believe that Intel would even try to allow the Chinese a foothold in the NAND market. And I think that Newman is being shortsighted in highlighting the R&D shortfall for Micron without also recognizing that Micron will gain quite a few additional bits to sell at a profit or to incorporate in other products at much higher margins than they were getting from Intel. Plus, Intel's R&D contribution surely will not amount to a 14% hit to operating profit. That has to be a typo.

This is an excerpt from techtrader daily:

The Street is still pondering Micron Technology's(MU) ( MU) announcement Monday that its partnership with Intel(INTC) to produce NAND flash is going to change after the next model of chips comes out, with the two companies developing diverging, separate roadmaps.

Yesterday, Micron's CFO Ernie Maddock sounded upbeat about the future of flash during a JP Morgan conference at CES.

Today, Mark Newman of Bernstein writes this is a negative for Micron, as it means the company will take up the part of R&D investment that Intel(INTC) had been paying, with perhaps up to a 14% hit to operating profit in fiscal 2019 and 2020. It's also a negative for the industry, he thinks, if it means potential fragmentation of the industry.

"We worry that this opens Intel(INTC) up to collaborate with Chinese partners in NAND, namely Tsinghua Unigroup, which is desperate to get its hands on proven memory technology," writes Newman.

More at Barron's Tech Trader Daily blog, barrons.com
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