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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: Michael Kim who wrote (12228)	6/26/2000 12:46:00 AM
From: Ausdauer	Read Replies (2) \| Respond to of 60323

Michael Kim, That was a very sobering post by Greenmale and I hope that he is wrong. He makes a strong argument. Given the market's treatment of SNDK and the lack of current evidence to support an earnings surprise I harbor the same fears as those expressed. Given Eli's projected total MB production increases and a relatively stable pricing environment I am still hoping that 22½ is a low ball estimate. I personally can't see it happening, but need to be prepared mentally if it does. Where are Cardin Drake and Ron C with their Karnack-like predictions? Aus

To: Michael Kim who wrote (12228)	6/26/2000 4:22:00 AM
From: Craig Freeman	Read Replies (2) \| Respond to of 60323

Michael, re: "our revenue and royalties are that much easier to predict." Given the same number of wafers are available from UMC and that every chip is presold, it appears that SNDK's bottom line will depend on yields on their 256Mbit chips. From the May 17th SEC filing: Gross Profits ... Product gross margin increased to 30% of product revenues in the first quarter of 2000 from 26% in the first quarter of 1999, primarily due to a lower cost per megabyte of our 128Mbit and 256Mbit flash memory products. We plan to decrease production of our 128Mbit products in the second quarter of 2000 as we ramp up production of our 256Mbit products. The 256Mbit flash chip has a lower manufacturing cost per megabyte and we currently expect it to contribute to improved product gross margins in the second quarter. The initial production period of each new generation of flash technology is subject to many risks and uncertainties as described in "Factors That May Affect Future Results - In transitioning to new processes and products we face production and market acceptance risks." Craig