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 : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: GVTucker who wrote (146229)	10/30/2001 1:10:49 PM
From: Dan3	Read Replies (1) \| Respond to of 186894

Re: goodwill is an issue, but it is an issue that is easily measured... obviously this will erode into a fruitless discussion There is always that risk. I'll just end it with the reminder that money spent (costs incurred) by Intel, but not yet accounted for in their earnings statements, went from from $11,675,000,000 in Q2 1999, to $23,740,000,000 in Q3 of this year. You can come to your own conclusion as to whether or not this should be a concern. Remember that in Q2 of 1999 the big runup in demand to Y2K had begun, AMD was a big question mark, with a small market share, and Intel's desktop processors were selling at prices approaching $1,000. Currently, Intel's market share has fallen down and can't seem to get up, they continue to face aggressive competition, and their most expensive desktop chip has been reduced to selling for a little over $400. Y2K is over, competition is up, and I just don't think Intel's assets are worth twice what they were in Q2, 1999. In fact, it's doubtful they're worth as much as they were in Q2 of 1999. And that's why I think Intel's balance sheet is worth a careful review. A $12 Billion dollar writedown would be necessary to put them back where they were in 1999 - that's not too far away from the $19 Billion NT had to take. If they continue to take those costs a piece at a time, their earnings will be under pressure for years (probably what will be done), which means that Intel's earnings are going to be poor for the foreseeable future even if their markets improve. If their markets don't improve, they face a big writedown or many quarters of losses. What Intel's liberal accounting since 1999 has done, is to hang a big millstone around their corporate neck - one way or the other, it's going to cost a lot of money to get that thing off.