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To: Dave who wrote (168456)	7/18/2002 2:14:02 PM
From: TGPTNDR	Respond to of 186894

Dave, Re: <...the low inventory level implies to me that AMD knew revenues would be light at least two months in advance. ...> Well, certainly. In the Q1 CC AMD said their channel was stuffed. They said they "SOLD" over 6M processors. That's over 500K more than my guess. They also guessed, in their 2Q cc that Intel's channel is now more "STUFFED" than theirs(AMDs). I'd guess we'll find out in a couple months what the story is. -tgp

To: Dave who wrote (168456)	7/18/2002 8:45:32 PM
From: Petz	Read Replies (3) \| Respond to of 186894

<The most shocking thing regarding AMD's announcement was no inventory buildup> If CPUs are held in wafer form, i.e., not packaged yet, the inventory can be valued at COST, which is maybe $20 per CPU. With $340M of inventory, there's plenty of room there could easily be 6M CPUs in inventory valued at $120M. If these CPUs are sold for $30 in the current quarter, AMD could actually book a profit on them. If last quarter's inventory was held as finished, tested product, it is very possible that there are actually more CPUs in inventory now than there were 3.5 months ago, even though the $ value of the inventory hasn't changed. NOTE: the breakdown of the inventory into raw materials, work in process, finished goods is made in the 10Q which hasn't been released yet. Petz