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

To: Amy J who wrote (125322)	1/17/2001 9:54:30 PM
From: Dan3	Read Replies (2) \| Respond to of 186894

Re: I expect AMD to fall further behind in technology, Intel has just shot it's wad for the next 4 years with P4, and it barely keeps up with a 9 month old Athlon layout. and this, combined with a capacity constrained envirnoment When capacity is constrained, everybody makes money. It's when capacity is in surplus (like now) that losses can occur. Intel, the company that used to be the king of cost control, is now fielding two uncompetitive chips, Celeron and PIII, and two huge chips, Itanium and P4. The problem with huge chips is that they cost a lot to make. If they are huge but perform a lot better than anything else, it's OK, because you can charge a lot more for them. But if your chips are huge and perform little better (or worse) than the competition, you've got a serious problem. When the other guy can make 50% margins selling parts equivalent to yours at less than your variable cost, you've got problems. Dan

To: Amy J who wrote (125322)	1/17/2001 9:57:51 PM
From: AK2004	Respond to of 186894

Amy re:to fall further behind in technology further than what? I think you could have said something like that without smile about 2 years back but now..... Regards -Albert

To: Amy J who wrote (125322)	1/17/2001 10:14:51 PM
From: Joe NYC	Read Replies (1) \| Respond to of 186894

Amy, it takes 3B (~AMD's revenue) to build a fab, not $1.5B. AMD already built a fab (actually 2) for microprocessors. They just need to add some .13u equipment. That's where the billion will go. The rest (I am not sure if it is a 1 billion or .5 billion is going to new flash fabs built in joint venture with Fujitsu (which is self financing). The next newest fab is planned for 2004, but it is still in a planning stage. Sounds like AMD will be taking on some more debt in the future. They may for the next fab, but probably not for the current capital expenses. If you paid attention last quarter, AMD actually retired big chunk of debt. I expect AMD to fall further behind in technology, and this, combined with a capacity constrained envirnoment where cash is limited, could be a very, very difficult situation for AMD during the next uptick. You are saying it as if AMD was behind in process technology, which is inaccurate. Currently, AMD cought up or actually gained lead in process technology that is in production. This is probably the first time ever this has happened. Of course I am not surprised at the arrogance of your post. It is common among Intel investors and employees. It comes from lack of knowladge, not from any evil character trait (I think). Intel may (or may not) regain the lead with their .13u technology, but it is too early to tell how it will really work out. I don't know where you get the stuff about capacity constrained environment. If there is any capacity constraint, it is only due to the fact that the P4 design takes twice the die area to achieve what the competing Athlon processor does. So (ignoring .13u transition at both companies for a moment) Intel needs to double the capacity just to stay even as the transition to P4 progresses. Just something to keep in mind for Intel investors during the next "We will bury you" outburst. The billion of cap expenditures is actually a defensive move, to compensate for weakness of P4, not an offensive move. Joe