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To: art slott who wrote (7367)	10/5/2001 9:45:32 AM
From: Kirk ©	Read Replies (1) \| Respond to of 8218

"And they've already shipped 25 million of the copper ones. It's a milestone. It took Intel more than a decade to ship that many chips of any kind." I am an IBM fan, don't get me wrong, but that statement of Doherty is really lame. Intel BUILT the market... pretty easy to match a given NUMBER of chips built 10 yrs ago after the market has been growing exponentially for decades where Intel has been a true leader. Now, if IBM matched square inches of Silicon as a percentage of square inches built in half the time, then I might do more than yawn. For example, perhaps the 25M chips were single transistors in SO packages.... or were these full sized microprocessors? but more important is what percentage of the market is this? If you are building on 300mm wafers, it is far easier to get to 25M anything than if you were building on 150mm wafers. Kirk

To: art slott who wrote (7367)	10/10/2001 1:31:25 PM
From: Arrow Hd.	Read Replies (1) \| Respond to of 8218

Time to think about what the quarter will bring. Very hard to even hallucinate how things will turn out based upon the events of 9/11 and the general economic conditions. The IT industry is extremely dependent upon the last few weeks of any quarter and we all know September was a lost month. I think it will be especially tough on the software and services sectors where quarter ending decisions are critical. Also, the services business has its own form of "book to bill" in the sense that as services contracts end those personnel need to be reassigned to new contracts to continue their billing and revenue generation. I believe this environment is not nearly as robust as it was earlier in the year. As we have speculated for the past number of months the consensus numbers have been quietly reduced. The SI numbers still show around .96 cents but Zacks and Thompson are .90 and .91 respectively. My sense is that by earnings release these numbers will have dropped down into the high 80s and the fourth quarter will have dropped too resulting in at least two consecutive quarters of YOY decreases. It is very hard to figure out what flexibility still exists for financial engineering. I know there is enormous pressure on expense control and there will be continued focus on keeping all services personnel billable or they will have 30 days to find a way to contribute or another career. This is going to be an extremely tough period but assuming the rate cuts and stimulus packages kick in next year I think we can get through without a lot of damage. So here is my guess which is no more valid than anyone elses: Earnings: .88 cents Revenue: breakeven or slightly negative YOY Margins: slight erosion YOY Forecast: CC will be a replay of July with cautionary comments on the economy, growth, revenue, earnings, 4Q and 2002 prospects. Highlights will be market share, technology advancements, product leadership, product positioning, customer and alliance partnering. All IMHO of course. Always interested in other opinions.