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

To: Pravin Kamdar who wrote (35773)	4/14/2001 8:10:03 PM
From: kash johal	Read Replies (3) \| Respond to of 275872

Thread, Some thoughts on PIV price cuts etc. If we assume Q2 CPU volumes will be flat to down. Intel quite possibly has 3-6M units of PIII and PIV in excess WIP. If they sell 30-31M units in Q2. They only need to produce 25M CPU's in Q2. They likely have capacity for close to 40-50M PIII equivalents by now - including the 0.13 capacity coming on line. If they run their fabs at 50-60% capacity they likely will have a loss. So it makes sense to ramp PIV's. So instead of selling; as follows: 14M celeries at $90 (including mobiles to reach this ASP). 13M PIII's at $175 (including mobiles to reach this ASP). 3M PIV's at $350 1M Xeon at $900 revenues= %5.485 Bn This would be disastrous: Alternatively They ramp as follows: 13M celeries at $90 11M PIII's at $175 6M PIV's at $275 1M xeons at $900 The results may not seem very different just another 300-400M to bottom line. But this way they can position themselves for a decent Q3 and Q4 if they can ramp PIV up to 8-10M/Qtr. Overall they have nothing to lose, as without the PIV they are dead and running at 60% capacity. So their strategy makes a lot of sense. How they expect to hit these volumes using RDRAM and dual channell MB - i have no idea. They are extremely vulnerable IMHO. However with AMD flopping on the beach with no mobiles or higher speed parts coupled with slow DDR ramp gives them some hope. regards, Kash