Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Time Traveler who wrote (33360)	6/17/1998 11:30:00 PM
From: Jim McMannis	Read Replies (1) \| Respond to of 1572905

Time Traveler, You mean that if AMD can pump out 4.5 million+ K6 and K6-2s in the 3rd quarter that they actually lose money? Wow, now that's mind boggling. <GGG> Jim

To: Time Traveler who wrote (33360)	6/18/1998 2:20:00 PM
From: Petz	Read Replies (1) \| Respond to of 1572905

TimeTraveler, re:<<K6 quantity>> K6 + K6-2 < 2M this quarter (Q2). If Q3 sees more K6-2 out there, that means AMD ramps up the production, that means the fixed cost would go up. You apparently know better than Lehman Bros which said: "AMD should easily meet/beat its 2.0-2.5 mil. 2Q98 K6 unit volume guidance (vs. 1Q98's 1.53 mil. units) and gain share" (from 06/08/98 report at lehman.com that means the fixed cost would go up. Variable costs go up on increasing production, not fixed costs. The die cost of a K6 is less than $15 and packaging and testing probably doubles that, but in any case packaging a Socket 7 PGA package is way cheaper than a Celeron or a Pentium II. But in any event, the variable costs are insignificant compared with the selling price of the chip. Petz