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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: Jim McMannis who wrote (33317)	6/17/1998 12:55:00 AM
From: Time Traveler	Read Replies (1) \| Respond to of 1573717

OK, Jim, any attempt by anyone other than the inside personnel trying to estimate the cost of K6 through number of wafers in question is really a waste of time. However, one can guess at what the overall cost of K6 production. Here is how, in the past quarter: - The management did hint that non-K6 business just broke even. - K6 had ASP of $120 with 1.55M in volume. - Total loss, before tax and joint venture revenue, was a whopping $106M Now, we can calculate a K6-production fixed cost of $120 * 1.55M + $106M = $292M. Say $300M to keep two significant digits due to too many embarrassing assumptions. AMD has to generate roughly $300M (plus a smaller amount with more volume and 0.25um capital equipment depreciation) of revenue in the K6 or K6-2 product just to break even this quarter. Hope this sort of answers your question, Time Traveler