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

To: Petz who wrote (41744)	12/8/1997 3:36:00 PM
From: StockMan	Read Replies (1) \| Respond to of 186894

P, Re -- 5000 8" wafers/week * 52 weeks * (25400 mm2 area per wafer) / (81 mm2 area per chip) * 0.9 (theoretical yield) * 0.6 (actual yield) = 44 Million CPU's I like your calculations. Keep it up. Especially your made up numbers for yield, and fixed area per chip.. This is the kind of stuff you should post on the AMD thread. Once again keep it up. You do good work!!! Please compute (on the AMD thread) the theoretical ASP's of the K6 and the Pentium, Use your own numbers. Stockman

To: Petz who wrote (41744)	12/8/1997 3:58:00 PM
From: L. Adam Latham	Respond to of 186894

John: Re: ...Intel's margins in CPU's will fall to the 50% area even as its competitor's (AMD, NSM, IDT) margins rise from negative to the 30% area. Remember that gross margins (Sales - COGS) are talked about here, not net margins. AMD can (and did) have decent gross margins, while suffering a net loss. For instance, AMD had a gross margin of 28% for Q3, and 34% for Q1-Q3 combined. I didn't check NSM or IDT, but would expect them to have positive gross margins as well. The point? Simply the same one that has been preached for quite some time: gross margins are not nearly as important as EPS. Adam (my opinions only, not Intel's)