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

To: Cirruslvr who wrote (115261)	6/9/2000 10:55:00 PM
From: ajbrenner	Read Replies (1) \| Respond to of 1571042

Re:You will probably have to revise your estimates downward after Q2 earnings release because of taxes. Cirruslvr & Thread, Since AMD will be sitting on at least 1.5 billion in cash after Q2 earnings is there any possibility that they could pay off enough of their debt that it would offset any tax liability? In other words make tax payments instead of loan payments. Just a thought. ajb

To: Cirruslvr who wrote (115261)	6/10/2000 9:56:00 AM
From: niceguy767	Read Replies (1) \| Respond to of 1571042

Cirruslvr: Re: "You will probably have to revise your estimates downward after Q2 earnings release because of taxes. But since we know this is expected, it shouldn't be taken as a negative. Who knows how many replies you, Mr. Bull ;), would get if they saw you lower your estimates without proper warning!" Comment: No doubt, taxes remain an unknown at this point, but given that booming flash and microprocessor markets could easily stretch well into 2001,based upon our current vantage point, and possibly well beyond 2001, given that we are only in the initial stages of global rewiring,my assumption is that marginal revenue growth will more than adequately offset the dampening effect of taxes... Assuming the same relationship between flash revenues and profits as we've witnessed in Q4 and Q1 (maybe not that large an assumption given the 3 new flash deals announced last week)exists over the next 3 quarters, and assuming Athy targets of 1.8, 3.6 and 7.2 million processors are achieved in Q2, Q3 and Q4 respectively (and Dresden rampup so far appears to indicate that these are not unreasonable targets), there is very little doubt that, come the annual report in Jan 2001, AMD will have racked up 5 consecutive record breaking quarters and demonstrate overall Y2000 revenue growth of as much as 100%...Mr. Ruiz is currently suggesting publicly that $4 billion in revenues is attainable, up from $2.8 billion in 1999(I'm still not ruling out $5 billion or more given that Q1 came in at $1.1 billion and Q2, Q3 and Q4 will most certainly exceed $1.1 billion)... Although it's exceedingly difficult to strip out the profit contribution of the microprocessor from the flash, it seems that AMD eps has increased at an approximate rate of $0.10 per 100,000 Athys since 99Q3...If this relationship were to hold throughout Y2000 in which 13 million Athys are projected, and using Q1 eps and Athy's of 1.2 million as a base, then Y2000 earnings could approach $12.00 before tax...Within this albeit very simplistic analysis model, a Y2000 after tax eps of $7.00 is readily attainable... and AMD will catch fire long before the annual report in January 2001 documents the remarkable (and that's a gross understatement, imho) AMD turnaround we are currently witnessing with record revenues exceeding $5 billion (i.e approaching 100% growth rate) and record after tax earnings of $7.00 or more. (May have to increase my October $70 and January $80 call inventory)