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To: Skeeter Bug who wrote (26620)	1/16/1998 3:22:00 AM
From: DavidG	Read Replies (1) \| Respond to of 53903

Skeeter, You did all those calculations just to prove most of what I was saying...that the gross cost for chips is somewhat below the $3.50 range. This is a number one might be able to compare with other memory companies in the DRAM and SDRAM business. That is what I said is known. What is not known and I am not sure it can be proven from your calculations is a net cost that you came up with as $4.80 per chip which could be used in the 2nd quarter 98 to determine if MU is making money or not. This is where I have a problem and I am saying you are mixing APPLES AND ORANGES. The expenses and costs include MUEI which makes it much more complicated than you are stating and even more complicated when trying to compare to other semi cos. In the second quarter the asp right now is something less than $4. Gross costs may drop to $3. As MU moves toward a higher %SDRAM the asp will increase accordingly. Expensses and Costs which includes MUEI may be the same, higher or lower. I don't know but you need to break out only semi numbers to do a fair comparison. This is where your logic falls apart. DavidG