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

To: daniel dsouza who wrote (37632)	10/26/1997 12:32:00 PM
From: Fred Fahmy	Read Replies (2) \| Respond to of 186894

<I may be missing something> IMO, you are missing a lot. I haven't seen any data or industry research that shows that PC's sales (revenue) grew 25% year over year in Q3. This is simply wishfull thinking. I have seen references to numbers in the mid to high teens. Futhermore, Compaq's unit growth has little to do with the entire industries revenue growth. Clearly CPQ's growth is higher than the overall industry. Re: Denial Intel has never denied that Segment 0 is not growing fast. In fact in their conference call they stated it was. However, in asbolute terms it is still very small. If you go from selling 10 of something to 20 of something that's great growth but if the 20 of something is only 10% of the entire opportunity then the absolute number remains fairly insignificant. Intel also pointed out that as fast as Segment 0 was growing, they saw even stronger growth in their "server, workstation, and mobile" products. Now, I'm sure many people like to think that they know more about Intel's results than Intel does or that Intel is an evil empire deceiving the investment community, but their track record proves otherwise. You talk about denial. I think the real denial comes from those who don't want to face the fact that Segment 0 PC's are not going to take over the world or replace the high end. Intel has continued to focus primarily on the high end (although they still dominate and continue to focus on Segment 0 as they were quick to point out) because that is were the real growth opportunity in computing resides...both from a total dollar and a margin dollar viewpoint. Intel is just starting its assault on the high end server market which until now has been dominated by others such as Sun. In addition, it is quite clear that Merced is aimed at taking away market share from big iron (i.e. mainframes). There is plenty of opportunity at the high end. The internet and worldwide corporate computer networks are not going to be powerd by Segment 0 PC's. Sure there will be some cheap PC's connected to these systems, but the engines of this growing infrastructure will be high end driven. In addition, I don't see Segment 0 PC's intruding on the mainframe arena. Do you?? As much as PC's and networked PC's have reduced the need for mainframes, mainframes are still quite important in the overall scheme of things. Intel's future chips have the potential to take way that much more from the mainframes. The fact that Segment 0 CPU's are becoming a commodity is a much much bigger threat to Intel's competitors who rely much more on this market. Cyrix's current financial ruin is already evidence of this. Bottom line: the company that has the most to offer at the high end will be the one that is the most insulated from pricing pressures as the worldwide technology revolution progresses. Good luck, FF