Formerly About Applied Materials Message Board

STOCKTALK

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.

Politics : Formerly About Applied Materials

AMAT 249.89

+3.1%

3:59 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Teri Skogerboe who wrote (20035)	6/9/1998 1:03:00 PM
From: robbie	Read Replies (1) of 70976

<<Consider the peculiar case of Applied Materials Inc., a formerly high-flying maker of semiconductor equipment. In the quarter ending in January, it paid $32.2 million to a company in a licensing agreement. Rather than consider the fee an operating expense, as Schilit said would be typical, Applied Materials called it in-process R&D, even though no acquisition had transpired. That accounting improved the company's operating cash flow by 26 percent.>> More information is needed to make a judgement on what is going on here. The article does not state what periods the license agreement benefits. Obviously if it benefits periods subsequent to Q1 it wouldn't all be expensed in the first quarter. It's also obvious that cash flow isn't improved no matter how the transaction is accounted for. The article's complaint is that the transaction makes the "operating" cash flow look better. Who's that going to fool? It's also interesting that the company was closed Friday and this article would have had to go to press Saturday. So the author didn't go to a lot of trouble to get an explanation from management. It's a non-event, IMO, until we get more details. Robbie (waiting patiently to go long again)

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next