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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: nihil who wrote (83980)	6/20/1999 1:35:00 PM
From: Tony Viola	Read Replies (2) \| Respond to of 186894

Nihil, Intel needs to add about $4 billion new product sales a year. I don't see how they can do it. I am still a holder. Sentimentalist, I guess. Why? IBM certainly hasn't done that percentage-wise. Check 5 years of blue revs: ibm.com Now check IBM stock performance: techstocks.com 4 bil a year delta would be nice, though. Otherwise, maybe Intel needs to study IBM's model a little more, the one Jules used to "critique". Hi Jules. Tony

To: nihil who wrote (83980)	6/20/1999 1:36:00 PM
From: WTSherman	Read Replies (4) \| Respond to of 186894

<)If I were China's computer csar I'd buy control of AMD or NSM. (They've got $100 billion of foreign exchange) and build a couple fabs there.< There is absolutely no chance that China or any Chinese corporation would be permitted to gain control of either of these companies. The subject of China buying whatever products they wish from U.S. corporations is becoming a very hot topic. The notion of them buying a key U.S. technology developer would send the body politic into spasms(rightfully, so). I'm also at a bit of a loss to understand this paranoia about AMD's K7. The market for this chip is certainly in the corporate sphere. I'm new to this thread, though, have held INTC for quite some time, so forgive the ignorance or repetition, if either is the case. However, to me it seems to me, that since AMD has made little headway in corporations with its low-end desktop processors, what leads one to believe that either vendors or their customers are going to rush to AMD based high-end platforms? IT departments are risk adverse animals and the minor cost differential or marginal performance differential isn't going to move them. If these factors were important to IT organizations, HP wouldn't still have 70+% of the laser printer market. Their products cost more and generally have lower performance. IT departments buy them because they know what they are getting and the risk associated with their deployment is as low as can be found in the market today. Workstations and servers are even more critical and less likely to be moved to new platforms...IMHO.

To: nihil who wrote (83980)	6/21/1999 12:54:00 AM
From: Amy J	Respond to of 186894

RE: "it hard to see how Intel can improve its profitability" Nihil, Regarding profit opportunities for Intel (from my post on the AMD thread): Server estimates/guesstimates could be summarized into a triangular graph (where Intel is the wide base of a triangle, with IBM at the narrow top): C P^.....X....IBM ---> Service O E\|.............. S R\|....XXX....Sun (up) T F\|100B est rev. market size hw; 30-40B est chips; 90-95% est margin . O\|.............. . R\|...XXXX..Intel (up) . M.<---------------> Volume shipments It's speculated in articles Intel's server market was 2-3B of the 30-40B and 30%-50% of units. Translated, there's a large opportunity to capture more of the 30-40B pie. Intel is still relatively new to the Server market, but it's interesting to see how Total Server Revenue growth in 1998 was relatively small (was it only 7%?) possibly because Intel was eating into this market segment and selling chips relatively inexpensively (when compared to other solutions) which probably explains the lower revenue growth for the Server industry. Since this market is mainly driven by Performance, not Cost, these customers have been willing to pay a lot of money for high-performing systems/Servers - until Intel arrived with an efficient, least-cost solution. The Server market has a lot of play room in pricing to generate very high margins. Reliability, road maps, brandname, and performance are drivers for this market's customers. Not included: comm opportunities In the non-Server area, there were reports estimating around $150B hw revenue, with 30-35B MPU, 25B Intel, 7B of 25B profits. Maybe 110M PC unit shipments, possibly 85M Intel. ====> In summary, if 7B is Intel's profit, imagine the impact of hypothetically 90% (estimated server margins) on some part of $30-40B with respect to profit growth. Now imagine adding the comm opportunity too. Caution: these figures are off the top of my head, so they may be wrong (i.e. either my memory could be wrong or the articles could be wrong - and I haven't done any cross checking between research articles/reports.) Regards, Amy J