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

To: John F Beule who wrote (13721)	8/8/2000 6:04:27 PM
From: wily	Respond to of 60323

Has anything changed since this announcement? I would think the only thing that has changed is that the secure cards are beginning to take the stage, and perhaps Sandisk's proprietary position there is not as good as it was with the MMC. I wonder what percent of world Flash sales are MMC as compared to CF? I'm wondering if Sandisk has any rights to the ATA interface for Flash -- ATA is an open standard, isn't it? Does anyone think that Sandisk gets royalties on their Flash memory cell architecture? Who would be using it? Another note on a different topic (probably not terribly relevant to anything): Looks like the chips inside these cards are bigger than I thought: From the Hitachi news release, they reveal that they are using two 256Mbit chips to make the 64MB MMC card, and that they are making the chips on a .25um process. Assuming a cell size for AND Flash of 10L^2, that gives you an array size of 80mm2, and add another 25% (WAG) for logic and spare rows, and you get a total chip size of 100mm2, which is about .4" to a side (if it's square, but it's probably not) -- I had been assuming .25" to a side. I think MMC cards and CF cards sell at roughly the same price per MB (someone please correct me if I'm way off). I'd say a good buy (depending on quality) is about $2/MB, while a good buy on DRAM right now is about $1.25/MB. Of course, with Flash cards you are also paying for the controller, which, in the case of the MMC, we can estimate at 1/4 the cost of the IC components. Let packaging be 1/4 of the total unit cost, and take 25% off for the retailer and shipping, and 35% off for profit. Now, compare to DRAM: Flash DRAM Retail Price 2.00 1.25 Less Retail markup (25%) 1.50 0.94 Less Profit (35%) 0.98 0.61 Less Packaging cost (25%) 0.74 0.46 Less cost of controller(25%) 0.55 0.46 Cost for 256Mbit chip $17.60 $14.72 Note that the actual numbers are probably a little higher since I started with a "good buy" number for the retail products, and ASP's are probably higher than that. Anyway, the cost penalty for the 25% greater die size for Flash vs DRAM is about 20%, give or take a LOT. Note that the DRAM numbers are based on chips manufactured on a .18um process vs the Flash chips made on a .25um process. Probably the biggest assumption here is that the DRAM makers are enjoying 35% margins now, same as the Flash makers. I do hear they are doing well, though... I wonder to what extent DRAM capacity will shift to Flash capacity to take advantage of the great Flash demand. I would think that enough large manufacturers have this option so that there would be a significant leveling effect between the two industries/markets. I'm pretty sure I heard Samsung comment about doing this. Looks like it wasn't too bad an assumption about DRAM margins: *** Micron posted an upside surprise with EPS of $0.41 (excluding all onetime benefits), beating our aggressive estimate of $0.37 and the consensus estimate of $0.34. Gross margin was essentially flat sequentially at 36.0%, excluding the one-time benefit. Operating margin was up 180 basis points to 20.1%. Bit shipments grew over 50% sequentially as Micron brought inventory levels down. Message 13933793 </ramblings> wily