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

To: Sid Turtlman who wrote (41935)	12/10/1997 10:13:00 PM
From: Jay	Read Replies (2) \| Respond to of 186894

Sid Re: "By spring this factor will be out of the way, but it could create a nasty negative earnings surprise in the interim." The negatives you pointed out are precisely why the stock price is not doing well now. OTOH a negative earnings surprise in this jittery time could cause much more than a one quarter phenomenon. With the tech sector battered an Intel shortfall will create further wholesale panic selling. Tech investors in the Silicon Valley area may then face both declining real-estate asset values as well as tanking stock values. This will cause much more than short-term pain - and may in fact affect the entire US economy. I could be wrong (I hope I am). All this IMHO JB

To: Sid Turtlman who wrote (41935)	12/10/1997 10:52:00 PM
From: Barry Grossman	Respond to of 186894

Sid, What you said about consumers not "needing" the high end cpu now isn't something new. This has been true for quite a while. There is still a huge installed base of 286. 386 & 486 pc's waiting to be upgraded though. New apps that are currently available and that become available will continue to drive the high end. In the meantime, the "low-end" will get connected to the Internet for the first time and ultimately will want to upgrade to a pc with more capability. As far as the build-to-order inventory effect, this too has been going on for most of this year so consequently much of the effect is already in the guidance. You only swallow the pig once for each customer that switches to this model. I believe Intel advised that this was the big reason for lower 3Q97 numbers than expected. The numbers would have been much better had the previous business model still been in effect. Barry