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

To: Joe NYC who wrote (77686)	4/18/2002 4:14:34 PM
From: tejek	Respond to of 275872

I think the haircut is due to the warning for Q2, which went from previous guidance of profit to at best breakeven. Joe, got it....I thought previously,Sanders had said a profit in the second half and not the 2nd quarter. Now I understand the price action today. Thanks. ted

To: Joe NYC who wrote (77686)	4/18/2002 6:30:02 PM
From: Petz	Respond to of 275872

Best and worst case for Intel Q2: First, gross margin is simply (Revenue minus cost of sales) divided by revenue. In Intel's case, for Q1 (6781-3301)/6781=51.3% Lo and behod, exactly what Intel reported as gross margin. For Q2, Intel expects 1. gross margin between 51 and 55% 2. revenue between 6400 and 7000 3. R&D plus MG&A expected to equal 2100, a slight increase from Q1, which was 2054. Neither R&D nor MG&A are included in Cost of Sales. The increase is probably higher R&D, since Intel says it has to average 1039 over the next 3 quarters to meet the reaffirmed total of 4,100. R&D was only 982 in Q1. So, worst case, if revenue is 6400, gross margin would surely be at the lower end (51%), so gross profit would be 6400.51=3264. From this we need to subtract R&D and MG&A, already estimated by Intel at 2100, giving minimum pro-forma operating income of 1164. Reduce this by .284 tax rate and divide by about 6850 outstanding shares and we get pro forma of 0.12/share, down from 0.15/share this quarter. GAAP net income would be reduced by estimated 115 before taxes, giving 1049 operating income, or 0.11/share, compared to 0.14/share this quarter. Of course the GAAP numbers no longer include amortization of goodwill, which would reduce the GAAP net income to 0.06/share. If Intel hits the max revenue ($7B), the pro forma net income is ((70000.55)-2100)(1-.284)/6850=0.18share GAAP net income would be ((70000.55)-2100-115)*(1-.284)/6850=0.17/share So the range for pro-forma net per share is 0.12 to 0.18 and 0.11 to 0.17 for GAAP net income. Petz