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

To: andreas_wonisch who wrote (30891)	3/8/2001 9:33:09 PM
From: niceguy767	Read Replies (1) \| Respond to of 275872

andreas: "A: Well, it turns out, that would have minimal impact on AMD. About 80% of our business is now under long-term contracts. Actually, approaching 85%, I've just been advised. So we really have very little impact from changes in spot market pricing." By the time pricing contracts are renewed, look at a rebound in flash pricing...By the way, my understanding is that not much competiton exists at the top end of the falsh market where AMD plays...Anybody know what's happening to pricing in the top end of the flash market...The top end is a monopoly market isn't it???

To: andreas_wonisch who wrote (30891)	3/8/2001 10:07:33 PM
From: kash johal	Read Replies (2) \| Respond to of 275872

andreas, re:"About 80% of our business is now under long-term contracts. Actually, approaching 85%, I've just been advised. So we really have very little impact from changes in spot market pricing." Well there are lies and damn lies. Majority of high volume semiconductors are sold under some form a contract. And then there is the "spot" price. These parts are typically sold by AMD's distributors who try and maximise their revenues depending upon the spot market. In general flash spot prices last year were running 3-4x contract prices last year. The answer by AMD is "technically" correct as they sell to disti's at a certain price with price protection. And the disti's mark up as they can depending upon market conditions. Major OEMS and contract houses such as Nokia, flextronics etc purchase by negotiated contract and PO's. And AMD has led by signing multi-year contracts with a "price collar" which changes as the "contract price" of flash changes. There is a tendency for folks to fall in love with their favorite stocks and look for any glimmer of hope. The bottom line is that flash will be in free fall. AMD is therefore significantly exposed to this, like it or not. regards, Kash