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

To: Paul Engel who wrote (53334)	4/15/1998 1:22:00 PM
From: gnuman	Read Replies (2) \| Respond to of 186894

Paul, re: "All new wafer starts will be PII" Don't you mean all new starts will be P6? Am I right in assuming that Celeron is classified as P6 but not PII? I noticed that Otellini talked about P6 in his statements, but made little or no reference to PII in yesterdays CC. Also, did you see my question to you on Celeron? exchange2000.com

To: Paul Engel who wrote (53334)	4/15/1998 1:50:00 PM
From: Maverick	Respond to of 186894

INTC analysis: bleak By Briefing.com Intel Stalls Intel The Way The Market Wants To Hear It: Intel earnings beat estimates by 9 cents in Q1, revenues were better than expected, the company saw the OEM inventory problem ending in Q2, margins would bottom in Q2, and sequential revenue growth will return in the second half of the year. The stock shoots up 2-3 points in after hours trading! Every word of the previous paragraph is true, and if you read that and buy Intel tomorrow for a daytrade, you might well be rewarded. But while the trader in us says buy, the analyst in us says that Intel's earnings report was not good. Here's why. Q1 Intel reported Q1 EPS of $0.81 excluding charges, and that did indeed beat the First Call estimate of $0.72, but there are two reasons not to cheer that result too loudly. First, it remains unclear whether market estimates included or excluded the previously announced 9 cent charge related to the Chips & Technologies acquisition. First Call went back and forth on this question, but ultimately said that the estimates did not include the charge, and that Intel therefore beat estimates by 9 cents. We have our doubts. Using the numbers from Intel's March 4 warning, we produce estimates of $0.67 including the charge and $0.76 excluding the charge. The First Call range of $0.64-0.77 was suspiciously close to these two figures, suggesting that their survey picked up estimates both including and excluding charges. We'll use Intel's March 4 guidance instead, and say that they beat that warning by about 5 cents. The second reason not to get too excited about this upside surprise is the fact that the $0.81 ex-charge figure was well below pre-warning estimates of $0.93 and the year-ago figure of $1.10. As noted earlier, revenues did beat the March 4 guidance of a 10% sequential decline, but they did so by falling only 7.8% versus Q4. And to make matters worse, margins fell sharply, to 54.2% in Q1 from 58.6% in Q4 and 64.2% in the year-ago period. For the record, the pre-warning Intel guidance called for sequential earnings to come in flat and margins to fall a "few points" from Q4. Q2 For those of you Pollyannas who don't like bad news, you might want to skip this section, because there's no way to put a positive spin on Intel's second quarter guidance. On the conference call, Intel put it rather bluntly -- "the conditions that led to disappointing Q1 results are expected to continue in Q2." Specifically, the condition causing the problem is a decline in orders from OEMs due to inventory problems.