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Technology Stocks : Micron Only Forum
MU 292.63-0.6%Dec 30 3:59 PM EST
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To: Skeeter Bug who wrote (39146)9/27/1998 12:08:00 PM
From: phbolton  Read Replies (1) of 53903
 
Some comments: (1) Intel's two top problems are slowing PC growth rate (both in price and in volume) and the defection to K2/K6/MII etc. The motherboard move hastened the acceptance of alternative CPUs by the box makers. Investing in MUEI will only further hasten the acceptance of AMD/NSM products and if Intel makes such a silly move to invest in MU it will probably be very positive for AMD over the next while.
(2) Intel is interested in cheap DRAM but that seems to be the case without them doing anything. DRAM is "commodity hell" and Intel is trying to avoid CPUs moving becoming commodities. The total DRAM market continues to shrink in actual dollars, down about 40-50% the past year.
(3) Intel wants Rambus to prosper but they have bets on all possible outcomes.
(4) Intel makes lots of investments like SYSF that turn out very poorly and are ill conceived and just as stupid as investing in MU.
(5) MU is currently a semiconductor company with only $250-$290 million in revenues per quarter, revenues have declined about $300 mil in each of the past two years, and the DRAM market declined about 45% in dollars this past year. Intel has $6 billion in revenues per quarter (thats 30 times as much as MU). Intel's margins are dropping but they are still very good. And well, lets not talk about MU's negative gross margin too much.
(6) I still think the rumour is nonsense but if anyone at MU started it its a felony offense. You can bet that there will be questions about the reality of this rumour during the conference call.
(7) Also, a $1 billion investment would give Intel effective controlling interest in MU and its very hard to see Mr Potato giving up any control whatsoever.
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