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

To: Dale J. who wrote (59763)	7/12/1998 4:52:00 AM
From: Steve Porter	Read Replies (1) \| Respond to of 186894

Dale, Well, Intel's approach is clearly geared towards the long-term. We probably disagree over its effectiveness. You believe AMD will survive and I think they will have to alter their x86 course to survive. I don't know whether AMD will survive as such. You may consider Cyrix dead or surviving.. they still kinda exist.. I can see the same thing happening to AMD.. if you really want a scarey thought some rookie was on the Cyrix thread and was talking about a merger/buyout between the 2 of them.. I mean Jeezus.. All hell is breaking loose. I have taken my loses now and dumped the whole damned sector on it's a$$ for now.. I may be back in on Monday, we'll see. Well I think profits will gradually start to increase for INTC. Due to XEON etc. For now.. but what happens as the bread a butter gets cheaper and cheaper.. I mean look at the volume equation here and things like depreciation. If, let's just say, Intel were to take deprecation from only the Xeon, etc. based sales then they would be break even on them (at best). That leaves the raw profit from the PII's. Don't forget this is an industry that has very NASTY capital expenditures in order to stay competitive. Intel has _SO_ many fabs (perhaps too many as witnessed by the warm down) that they have a lot of cost there. Sure most of it is paid for by now, but for everyone they close Intel seems to open 2.. that's not cheap.. I mean what's the average going rate for a "good" fab these days (with equipment) $2B+? That's 2 quarters of profit they way things are going.. what happens when the .35, .25 need to be retrofitted, let's say the cost is $800M a fab.. do you know how many fabs that is to be refitted.. all this to stay "competitive".. it's not a good indsutry the way things are going at all (IMHO). AMD, unlike the DRAM companies, needs and desperately wants higher margins. They don't have any alternatives as their creditors are at their door. "Jerry, we know your in there now give us our money back". AMD doesn't need higher margins!.. they need better management and better descision making. They need to ditch Vantis and the rest of the crap that is getting the $hit kicked out of it. They need to FOCUS on cpus. They need process people with a brain. They need a CEO who doesn't eat CRACK for breakfast every morning with a big spoon. That's what AMD needs ;-) Yes, we agree. That is very wise. But that is my point INTC is taking AMD seriously and vigorously responding. I'm not counting AMD out yet, but if they continue on the same path, then they have less than a year. JMO of course. Let's agree to disagree on that one for now.. the reason is simple I have heard the same thing for the last 5-8 years about AMD. Still hasn't happened. Well maybe not, the DOJ lost the latest round and the Appeals Court sent a message to the FTC/DOJ about meddling in the technology business. Yes, right now the DOJ/FTC investigations are a bad and pointless exercise. But if Intel were to be the _ONLY_ supplier (give or take 5M cpus a year), I think they would have little choice. Ofcourse no one would care much in the investing community as Intel would be back to making $2B profit a quarter off of CPUs. Steve, you and I are actually in agreement over AMD. They sent the wrong message to Intel, and now they are paying a price. Well we agree to some extent.. I'm not sure if it was the message itself or the messenger however. Steve