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 : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: Petz who wrote (653)	7/13/2000 5:27:12 AM
From: niceguy767	Read Replies (2) \| Respond to of 275872

Petz: Re: "All I can say is that if AMD was assuming that 3 full quarters of earnings would hardly require any tax payments, and then changed their mind so that one quarter of earnings requires paying taxes, either some accountant really goofed or AMD has fantastic earnings this quarter." Comment: Thanks for the great overview regarding taxes...I, also, was wondering how AMD could possibly suggest paying taxws in Q2 without phenomenal (i.e $500 million in earnings)... Now I'm really curious about this $1.5 billion revenue rumour...If any authenticity to it, I guess AMD could claim guidance was given masked in the Q2 income tax comment... By the way, betcha it wasn't the accountant that goofed...

To: Petz who wrote (653)	7/13/2000 11:07:52 AM
From: Petz	Read Replies (1) \| Respond to of 275872

First, DO NOT ATTACH ANY CREDENCE TO THE 1.5B REVENUE RUMOR. The devil is in the details and the details say that the news was fabricated. Second, in the prior post, I discussed how much profit it would take to eat-up all of AMD's remaining tax credits. I came to the conclusion that capital gains might not eat up the tax credits as quickly as operating earnings, and now I came up with a reason this might be true. [HINT: We really need a corporate accountant on this thread to check out my reasoning!! Does anyone know anyone???] When AMD bought Nexgen they paid far above "book value" for it. It may be that the excess amount is treated for accounting purposes as if it was a capital loss -- the only difference from a "normal" capital loss is that its subtracted from net income over a long period of time and this process is refered to as "amortization of good will." I'm wondering whether the accounting laws allow AMD to take a capital gains and allow part of it to eliminate this "amortization of good will" -- which will increase future taxes by increasing reported profits -- rather than by directly paying taxes on the capital gain? Who cares? If someone could figure out what percentage of AMD's Vantis capital gain actually ate up their tax credits, they could come up with a minimum profit projection for this quarter, based on the fact that AMD will be paying taxes. Petz