Yousef, YOU are wrong. Cost/wafer means COST PER WAFER. That means, if yields drop and Intel produces half as many CPU's, the cost per wafer stays the same. Cost per wafer is a relatively constant value that depends on the semiconductor process (e.g., AMD's CS44E process) and doesn't change much with quantity, yield or even die size. Depreciation expense is also easy to forecast for a quarter or two, because you know exactly how much depreciation is for existing equipment and you know almost exactly how much more equipment you will be buying short term.
The widely quoted $2,000 number does NOT include depreciation. PERIOD. DO THE MATH.
Now, in case you still don't believe me, check out what your buddy Paul Engel says:
Message 5231853
My guess is that 15 to 18 per cent of Intel's business is NON x86 CPU in nature.
So add a few percent for chipsets and you still haven't reached the 25% I assumed.
In a discussion last July on Intel's costs for the Pentium II:
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The 0.25 micron Pentium II devices are probably closer to $50 - including packaging.
After this, I asked the following question:
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So, how do you say that costs are closer to $50? Are you excluding depreciation or other "fixed" costs?
To which Paul Engel replied:
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Subject: Advanced Micro Devices
To: John Petzinger From: Paul Engel
Jul 17 1998 12:23AM EST
Reply #34627 of 45533
Petz - Re: " Are you excluding depreciation or other "fixed" costs?"
Of course.
Paul
Q.E.D.
Paul Engel says the costs of a Pentium II, NOT INCLUDING DEPRECIATION or R&D or MG&A expenses is $50.
Do you want me to show you the post where he said that Intel gets routinely 150 good Pentium II's PER WAFER????? Find it yourself.
Q: So if the cost per CPU is $50 and there are 150 CPU's in a wafer, what is the total cost per wafer?
A: A hell of a lot higher than $2,000 and that doesn't even include depreciation, BY PAUL'S OWN WORDS.
Petz |
