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

To: Cravey who wrote (191514)	3/31/2006 7:27:28 PM
From: Cravey	Read Replies (2) \| Respond to of 275872

Too late to edit, but following on the previous post. In Q305 CPG had incremental revenue of $202M q/q. So in the quarter that dual core started to gain traction, AMD threw an incremental $29M in bonus/profit sharing at cost of goods sold. For Hans, that works out to over 14% in gross margin on the incremental sales. Product gross margin (excluding bonus) appears to be flowing through just fine. The issue is not dual core yields. AMD rewarded its workforce on the achievement of better numbers. Future levels are totally within AMD's control in setting the bonus hurdles. Given AMDs action in Q3, I expect they did much the same with bonus amounts in Q4 with even better financial numbers. I think Hans jumped the wrong direction. Cravey.