Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Micron Only Forum -- Ignore unavailable to you. Want to Upgrade?

To: Bharat H. Barai who wrote (47138)	7/14/1999 10:14:00 PM
From: dumbmoney	Respond to of 53903

(1)There is continuing PC demand. Low end PCS come with 32 MB RAM but there is strong demand, even i Q2, a weak quarter, traditionally Look at Intel's numbers. (2) No major manufacturer has inventory. False. (3) Most important: because of anti dumping ruling, no off shore manufacturer can sell 64 MB chip below $8 in USA. They stopped selling in USA 5 weeks ago. Only DRAM made in USA can be sold at less than $8 per 64 MB chip. False. (5) No more new capacity has been added or will be added in any foreseeable future. Everybody has taken huge losses in last 3 years. False. Cost reduction (smaller die) = capacity increase.

To: Bharat H. Barai who wrote (47138)	7/15/1999 2:48:00 AM
From: Jeff Leader	Read Replies (2) \| Respond to of 53903

1) Expanded share of low-priced PCs continues to pressure bit-growth per PC. 2) Completely untrue. Micron stated less than a month ago that their inventory increased last quarter. I believe it stood at about 8 weeks at the end of May. 3) You're dreaming. 4) If you run the numbers, Micron has the capacity to supply about 60% of world PC DRAM demand. There is still a huge glut of DRAM in the world. 5) New capacity is added constantly via die shrinks. That's pretty much the only way to cut unit costs. FYI, AMAT said they expect order growth of 26-30% this year. 6) July and August are often tough months. With Y2K coming up, Q4 is a crapshoot at best. Also, the past two years have seen massive channel stuffing in Q4, followed by massive indigestion in Q1. There is always a chance the PC OEMs will learn from past mistakes. 7) There are no applications on the immediate horizon to generate increased DRAM requirements. See also #1 above. IMO the recent increase in DRAM prices is temporary. Prices were probably overly depressed in late June due to end-of-quarter deal-making. A bounce was no surprise. But the glut remains, and MU's inventory is out of control. So prices will trend lower. And lest you get too excited over $5.50 DRAM prices, recall that MU's ASP last Q was about $7. And they lost money. It doesn't take a rocket scientist to see that this Q will be worse. (But apparently it requires more intelligence than the average Wall St analyst possesses.) I expect red ink from MU for another 6-9 months MINIMUM.