uncle, how's this for a very conservative back of the envelope calculation for calendar Q4. Rambus will recognize this revenue in calendar Q1 2000 due to their accounting procedures.
You say $25, so I'll use $20 per chip to be conservative. Also, the costs will come down with volume. The price per chip will come down even more as time goes on.
Samsung will make 5 million chips/month. Since they're the leader, I'm assuming they will manufacture 50% of the total output for Q4.
Therefore, I'm assuming 10 million chips will be sold per month or 30 million per quarter.
With these assumptions we can conclude for calendar Q4 1999:
30 million chips X $20 = $600,000,000 in chips sold.
$600,000,000 X 1.5% = $9,000,000 in revenue for Rambus
$9,000,000 x 60% = $5,400,000 after tax net income
$5,400,000/24,000,000 = $0.23 per share.
.23 + .08 (current eps)= 31 cents per share!!
This assumes no Sony Playstation II royalties b/c Sony is undertaking a huge project. The P.S. II may or may not be on time for a Winter rollout in Japan. Even if it does debut, the volumes will be low.
Mark Edelstone has Rambus earning 21 cents in calendar Q1 2000. I just figured they'd make at least 31 cents with what I believe are very conservative assumptions.
This is just the beginning of the hockey stick curve. Earnings estimates will have to be raised by all brokerage houses.
I welcome all comments/criticisms on the above assumptions,
Regards,
Doug |
