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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: herenow_2 who wrote (54415)	10/22/2001 3:22:38 PM
From: Ian@SI	Respond to of 70976

In fact, today's article has suggested that the bulk of next year's spending will be concentrated on 0.13 micron process technology and production lines for the fabrication of 300-millimeter wafers. This would imply that the bulk of the Capex will go directly to putting Equipment into existing fab shells. Thus a larger %age of INTC's Capital budget would come into this sector.

To: herenow_2 who wrote (54415)	10/22/2001 4:24:34 PM
From: Gottfried	Respond to of 70976

herenow_2, thanks for the briefing.com info on Intel capex. Patrick said >it is clear the market is hoping Gelsinger spoke the truth and was quoted correctly< I'm sure we'll get a check on this monthly or weekly from now till December 2002.<bG> Gottfried

To: herenow_2 who wrote (54415)	10/22/2001 7:21:42 PM
From: Jacob Snyder	Read Replies (2) \| Respond to of 70976

If this Intel capex news is correct, together with what TXN said in their CC (their 2002 capex was expected to be at the same rate as during 2H01), then we may be seeing the bottom in semiequip bookings, right now. This contradicts what NVLS said recently, that bookings were still falling. If Intel and TI do in 2002 what they've now said they are going to do, it's likely the rest of the semi industry will have to follow. There better be that fabled 2H02 recovery, and it better be a strong recovery, or else semi overcapacity is going to go on and on.

To: herenow_2 who wrote (54415)	10/23/2001 11:25:30 PM
From: Zeev Hed	Read Replies (1) \| Respond to of 70976

Herenoq, I don't understand the "Street" point of view that INTC will saddle itself with "enormous fixed cost" (Ragsdale astutely* points out that Intel will be setting itself up for an enormous amount of fixed costs)*. Not very astute at all. First, if INTC does spend $6 B next year in CAPEX, it will be less than their ongoing depreciation charges per year ($6.6 B currently), thus, in principle, even with that addition, cost will go down by a net of about $500 MM (once capital assets are depreciated, they no longer hit the COGS line). One can make an argument that INTC should spend at least at the rate of depreciation charges, without impacting its cost structure. Zeev