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

To: steve harris who wrote (104021)	4/11/2000 8:13:00 PM
From: kapkan4u	Read Replies (2) \| Respond to of 1576152

Thats why I divided it by two to reflect 50% margins. Kap

To: steve harris who wrote (104021)	4/11/2000 8:30:00 PM
From: Petz	Respond to of 1576152

Steve, re"<I'm sure it's been discussed before, but that 200million extra in revenue has costs involved, does it not?> Look at going from Q3 to Q4 - sales exploded by $306M. "Cost of Sales" went up only $137M. As I said, the other items of cost like MG&A, R&D, are predicted in the CC, and their changes are independent of sales and generally don't change much from quarter to quarter. Depreciation is included in cost of sales. Petz

To: steve harris who wrote (104021)	4/11/2000 11:31:00 PM
From: that_crazy_doug	Respond to of 1576152

<< re:"Assume $1.1B revenue with Q4 break-even ($900M) and 50% margins. We get $200M divide by 2 divide by 150M shares equals $.66 EPS." I'm sure it's been discussed before, but that 200million extra in revenue has costs involved, does it not? >> He's factoring cost, that's why he divides by 2 or else it'd be over a buck (200/150). However, I believe that the 900M point is too high for break even. If I recall correctly, costs were 900M last quarter. That doesn't mean 900 was the true break even number, because there were also incremental costs. So the true break even was probably about 65M below that. (if you assume 50% incremental costs) Thus a real break even around 835. Now if we get 1.1B and 50% goes to earnings afterwards, then we'd have about 132M in earnings or $.88 a share. However that's a pretty simplistic analysis.