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Politics : Formerly About Advanced Micro Devices
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To: Richard Tuck who wrote (31452)4/8/1998 2:01:00 PM
From: Katherine Derbyshire  Read Replies (1) of 1572033
 
>>In the case of AMD and Intel, AMD has to go to 0.25um in order
to survive. As someone pointed out, the Fab 25 building should be
as depreciated as any of Intel's 0.35um plants, so the steppers,
etchers, and other equipment are the main extra depreciation cost.
Until AMD ramps the 0.25um process up fully, this depreciation
will be a considerable per piece cost (thus the $700 million
break-even figure). Once AMD ramps up 0.25um later this year,
this will be less of a factor.<<

The cost of steppers, etc, is hardly trivial, though. In a new fab, more than half of the total cost is equipment. AMD is probably looking at $500-700 million (cash expenditure, not depreciation) in equipment alone.

Katherine
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