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Politics : Formerly About Advanced Micro Devices
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To: Paul Engel who wrote (34687)7/17/1998 5:27:00 PM
From: Petz  Read Replies (1) of 1572552
 
Paul, thanks for your response on ASP's
Intel sold approximately 20 million CPUs last quarter - possibly as many as 20.8 million.

Their ASPs were in the range of $225 ñ $10.

My guess is that 15 to 18 per cent of Intel's business is NON x86 CPU in nature.

Put this together with a 15-July-98 Salomon-Smith Barney reserarch report, which said,

This transition is driving the gross margins of the company's microprocessors lower. When combined with about 25% of total company revenues that are non-microprocessors with, perhaps, a 30% gross margin, a weighted average gross margin in the low-to-mid 50's percent
results.
...
We believe that the average microprocessor selling price heldabout flat in the second quarter of 1998 at about $215 per unit. With units
shipped declining from an estimated 21 million in the first quarter of 1998 to about 20 million in the second quarter of 1998, microprocessor revenues fell from an estimated level of about $4.5 billion to $4.3 billion sequentially.


BTW, the report mentions the added "$20 to $25" cost of the Slot 1 module and price pressure from AMD as being primarily responsible for the drop in margins on the microprocessors to 53%.

The report validates my guesses of cost of production of the average Intel microprocessor as being above $100:
Cost/CPU = ASP*(1-gross margin) = $215 * (1-0.53) = $101

It makes you wonder why Intel decided to "go after" AMD and sell 300 MHz Celerons for less than $100 starting August.

Petz
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