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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: andy kelly who wrote (74827)	10/10/1999 1:31:00 PM
From: Yousef	Read Replies (1) \| Respond to of 1572953

Andy, Re: "AMD will start deducting $25M per quarter for depreciation. This doesn't seem like "enough" depreciation to me. $100M per year would take 19 years to depreciate that FAB!" You're right Andy, something doesn't all "fit" here ... The L&B (Land&Building) is usually depreciated on a longer term. This is probably about 250M$ of the 1.9B$. My only other guesses are: 1) AMD has NOT outfit the entire Fab yet. Minimal equipment set would be about 500M$. 2) AMD is getting "help" from German government to offset depreciation. Make It So, Yousef

To: andy kelly who wrote (74827)	10/10/1999 1:49:00 PM
From: kash johal	Respond to of 1572953

Andy, Re: "$25M for depreciation" This number was for the incremental jump in Q2(when they expect to realize first revenues). They are already eating some depreciation already. As they ramp the equipment the depreciation will increase further. regards, Kash

To: andy kelly who wrote (74827)	10/10/1999 6:58:00 PM
From: tejek	Respond to of 1572953

RE <<<Your mention of $1.9B for Fab 30 brings a question to my mind. In the cc, Jerry, I think, said that when Fab 30 starts producing in Q2 2000, AMD will start deducting $25M per quarter for depreciation. This doesn't seem like "enough" depreciation to me. $100M per year would take 19 years to depreciate that FAB! Am I missing something?>>> From what I understand, both the provincial and federal gov'ts provided financial assistance to the Dresden fab. The feds are making an effort to get employment up in the old GDR and the provincial gov't wants to make Dresden a locus for hi-tech employment; in fact the industrial park in which the fab is located is all hi-tech. If I remember correctly AMD got millions of dollars in assistance and I think the land was provided gratis or at a reduced price. I will try to find the posts that discussed this issue. ted