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To: oldirtybastard who wrote (77479)	3/8/2001 6:44:00 PM
From: John Graybill	Read Replies (3) \| Respond to of 436258

INTEL CONFERENCE CALL "Revised Outlook for Q1 Earnings" Thursday March 8, 2001 3:00 PM PST (the transcription ain't perfect! -- jg) Speakers: Andy Bryant Senior V.P. Chief Financial Officer Sean Maloney Executive V.P. Director, Sales and Marketing Group (introduction of Investor Relations person) (introduction of speakers by Investor Relations person) AB: we see weakness in almost all INTC products, not only processors, but also flash, networking... higher than normal inventory... reserves for older-generation flash and some networking stuff is higher than normal... reserves for uP's are at high end of expected range... deferring pay raises for big-shots until October... restricting hiring... no more free PC's to employees... income from investments this Q $180M, no change from prev estimates... cap spending unchanged from $7.5B... "current climate is grim"... "but recessions always end"... SM: telecom has cancelled large orders, and pushed out orders from Q1... flash outlook is based on cell-phone usage... server segment dropped more than desktop and mobile segment... chipset inventory is generally acceptable... difficult to predict 2H demand... Minnie Shmale (?): what has changed in flash? SM: slowdown in PCs, and slowdown in cell-phones. Charlie Gladdin, CSFB: P4 ramp? non-Rambus alternatives? will INTC do Rambus chipsets, or will 3rd party? SM: P4 ramp is going as expected... AB: we will build inventory this Q... we will need more capacity in 2H Dan Niles, Lehman Bros: extrapolate Q1 margins to Q2 and rest of year? AB: not ready to give long-term #'s... margins will follow revenue... DN: how much reserves (inventory?) ? AB: not willing to say... Mark Edelstone, MSDW: when was last time units were at this level? AB: dunno... blah blah blah... if only PC sales were down we wouldn't be having problems, but it's servers too... (?) headcount? AB: 88K-90K (?) will advertising $ drop now? SM: no plans for cutbacks David Wong, UBS Warburg: significant decline in PC ASPs? SM: no David Wu, ABM AMRO: long question about margins, Zenon processors? SM: dot-com problems, not as many servers sold Terry Ragsdale, GS: PC ASP's going forward SM: difficult to give projections, slowdown in servers Dan Scoville, (?): any signs of recovery? SM: no, tough to guess, 2H recovery (yet again -- chanted monotonously like a magic spell -- jg) DS: booking levels? AB: depends on overall demand, we look at GDP, consumer confidence, etc. DS: any reason for us to expect that 1Q will be a bottom? AB: don't want to speculate Joe Osha, Merrill Lynch: I am surprised to hear it is non-region-specific, are Europe and Asia just as bad as US? SM: Europe has been uninspiring for some time, we are seeing cancellations from every area... JO: would you characterize weakness in Asia and Europe as emerging, or continuing? SM: (mumble mumble) Eric ?, Robbers & Stealers: P4 ramp is scheduled for next year, but will you pull it into this year though? AB: unlikely (?) update us on outlook for depreciation? AB: $4B this year, no change from prior guidance, no # for 2002 yet... depreciation is not a function of revenue... Graham Tanaka, Tanaka Capital Mgmt: how long to work off inventory? SM: we have two new architectures, strong growth there... strong in optical networking... Peter Vanderlee, SSB: is Europe getting worse? SM: Europe PC growth is worse than Asia, US... we need to look closely at data coming out in next few weeks... PV: both consumer and business? SM: biz sales have been uninspiring for 3 Q's... Dan Brady, Presidio Mgmt: (lost) Bear Stearns: (already answered) Drew Peck, SG Cowen: there have been more price cuts than I can remember, and deeper, have they all been accounted for? SM: I take issue with "deeper", high-end prices are holding up... DP: quantify "top of inventory range"? SM: blah blah evade AB: we won't give specific information Dan Niles: why would this be just a 2-Q long phenomenon? AB: seasonal pattern, measure 2H vs 1H, we assume economy will stabilize DN: how much of 25% decline is inventory reduction (lack of channel stuffing? -- jg) SM: demand isn't what we want, inventory levels are low, people will go with our new technologies, we are ready with new products