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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Sam who wrote (50750)	1/13/2011 5:00:47 PM
From: Sam	1 Recommendation Read Replies (1) \| Respond to of 95610

INTC Q1 2011 Outlook The outlook for the first quarter does not include the effect of any acquisitions, divestitures or similar transactions (such as McAfee and the wireless division of Infineon) that may be completed after January 13th. The mid-point of the forecast ranges will be referred to when making comparisons to specific periods. Revenue Revenue is expected to be $11.5B, plus or minus $400M in the first quarter. The midpoint of this range would be flat from the fourth quarter, which is better than the average historical seasonal decrease. The better than seasonal decline is driven by an extra week in the first quarter and the ramp in sales of the Sandy Bridge product line. Gross Margin Gross margin in the first quarter is expected to be 64%, plus or minus a couple points. Gross Margin Reconciliation: Q4’10 to Q1’11 Outlook (67.5% to 64% +/- a couple points) [note: point attributions are approximate] ? - 2.0 points: Higher other cost of sales (primarily startup costs) ? - 1.0 point: Higher platform unit cost Spending Spending for R&D and MG&A in the first quarter is expected to be approximately $3.4B, flat from the fourth quarter. Depreciation is forecasted to be approximately $1.2B, up slightly from the fourth quarter. Other Income Statement Items Gains and losses from equity investments and interest and other income are expected to be a net gain of approximately $200M, up from $140M in the fourth quarter. 2011 Outlook The Outlook for full year 2011 does not include the effect of any acquisitions, divestitures or similar transactions (such as McAfee and the wireless division of Infineon) that may be completed after January 13th. Gross Margin Gross margin for the year is expected to be 65%, plus or minus a few points. Gross Margin Reconciliation: 2010 to 2011 Outlook (66% to 65% +/- a few points) [note: point attributions are approximate] ? - 3.0 points: Higher other cost of sales (primarily startup costs) ? + 1.0 point: Lower platform unit cost ? + 1.0 point: Higher platform** revenue Spending Spending for R&D and MG&A for the year is expected to be $13.9B, plus or minus $200M, 8% higher than 2010 due primarily to an increase in R&D investments, additional marketing, and annual salary increases. R&D spending is expected to be approximately $7.3B, up 11% from 2010. MG&A is expected to be approximately $6.6B, up 5% from 2010. Depreciation is forecasted to be approximately $5.0B +/- $100M. Other Income Statement Items The tax rate for 2011 is expected to be 29%. Balance Sheet and Cash Flow Items Capital spending for 2011 is forecasted to be $9.0B plus or minus $300M, $3.8B higher than 2010. The increase in capital spending is primarily driven by an incremental high volume manufacturing factory at 22nm and moving graphics transistors to the leading edge technology.