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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: andreas_wonisch who wrote (125037)	1/16/2001 4:26:48 PM
From: Road Walker	Read Replies (1) \| Respond to of 186894

The guidance should make Mary happy: Current negative trends in global economic conditions make it particularly difficult at present to predict product demand and other related matters. The company's best estimate given the high level of economic uncertainty is that revenue for the first quarter of 2001 will be down 15 percent, plus or minus several points, from fourth quarter revenue of $8.7 billion, due to seasonal factors and the impact of slowing worldwide economies. Gross margin percentage in the first quarter of 2001 is expected to be 58 percent, plus or minus a couple of points, down from 63 percent in the fourth quarter primarily due to lower revenue. The company's expectation for gross margin percentage for 2001 is uncertain at this time, however, it is the company's goal to at least equal first quarter gross margin percentage for the full year. In the short term, Intel's gross margin percentage varies primarily with revenue levels, product mix, changes in unit costs and timing of factory ramps and associated costs. Expenses (R&D, excluding in-process R&D, plus MG&A) in the first quarter of 2001 are expected to be approximately flat with fourth quarter expenses of $2.4 billion. The company continues to invest heavily in R&D for its future product roadmap and expansion into new networking and communications businesses. Expenses may vary from this expectation depending in part on the level of revenue and profits. R&D spending, excluding in-process R&D, is expected to be approximately $4.3 billion in 2001, up from $3.9 billion in 2000. The higher R&D spending is primarily for next generation manufacturing technology and product development. Capital spending for 2001 is expected to be approximately $7.5 billion, up from $6.7 billion in 2000. Despite near term uncertainty, the company will use its financial strength to invest for the future in key areas such as 0.13-micron process technology which will enable the company to produce new and more powerful microprocessors beginning later this year, and 300 mm process technology which is expected to lead to microprocessor unit cost reductions of approximately 30 percent in 2002 and beyond. The company expects gains from investments and interest and other income for the first quarter of 2001 to be approximately $180 million. This expectation assumes no net gains from the sale of equity investments, and will vary depending on equity market levels and volatility, the realization of expected gains on investments, including gains on investments acquired by third parties, interest rates, cash balances, mark-to-market of derivative instruments and assuming no unanticipated items The tax rate for 2001 is expected to be approximately 30.3 percent, excluding the impact of acquisition-related costs, down from 31.8 percent in 2000, primarily due to a change in the expected distribution of earnings among various tax jurisdictions. Depreciation is expected to be approximately $880 million in the first quarter, and $4.0 billion for the full year 2001. Amortization of goodwill and other acquisition-related intangibles and costs is expected to be approximately $455 million in the first quarter, and $1.8 billion for the full year 2001.