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To: Jim McMannis who wrote (62443)	8/13/1998 11:34:00 PM
From: Tony Viola	Respond to of 186894

Jim, thread, here's a Motley Fool article about Intel. There's at least one error in it (find it?), but I hope the guy's even just mostly right. Check out the "puppies" part. Remember the K9? fool.com Tony

To: Jim McMannis who wrote (62443)	8/14/1998 1:47:00 AM
From: Paul Engel	Read Replies (3) \| Respond to of 186894

McMannis - Looks like your Cyrix/NSM is going from BAD to WORSE ! " National sees big loss in second half of 1998 " Halla is claiming NSM is in trouble because of the shift to sub $1000 PCs ! Has this guy lost his senses - or has always been an idiot? Paul {====================================} pubs.cmpnet.com A service of Semiconductor Business News, CMP Media Inc. Story updated at 11:45 a.m. EDT/8:45 a.m. PDT, 8/13/98 National sees big loss in second half of 1998 By Mark Hachman Electronic Buyers' News SANTA CLARA, Calif.--National Semiconductor Corp. here has reversed course from its earlier optimistic forecasts, predicting a "significant net loss" during the second half of 1998. In management commentary accompanying the chip maker's fiscal 1998 annual report, National adopted a significantly more pessimistic stance towards the same numbers the company first reported in June. Now, National predicts that its financial performance through the end of the calendar year will be affected by the growing trend towards sub-$1,000 PCs and a slowdown in chip orders. The documents were filed on Monday. National "remains very cautious about its future outlook, particularly with respect to the personal computer business," the company said. "As a result, the company expects overall revenues, particularly for the first half of fiscal 1999, to be down from the level of revenues recorded in the second half of fiscal 1998, resulting in a significant net loss for the first half of fiscal 1999." National's fiscal year ended May 31. The Santa Clara company said it expected gross margins to pick up because of manufacturing efficiencies and cost reductions, which include a previously announced, planned reduction in its workforce of about 1,400 employees. National also expects that its fiscal 1999 capital equipment expenses will be lower than in fiscal 1998, primarily because it has already outfitted its new South Portland, Maine production fab. In 1999, the expenditures will simply entail expanding that fab's existing capacity and research into next-generation manufacturing technologies. But National also warned that a slowdown in orders during fiscal 1998 meant that amount of wafer capacity actually being used had dropped. Until orders pick up again, the company said, its fabs would run at a reduced rate that was undisclosed. National is also contractually obligated to purchase a minimum of $330 million in goods and services from Fairchild Semiconductor through June 2000, as part of the deal associated with the spinoff of the company in March 1997. In June, National executives presented a guardedly optimistic outlook. "Current weekly order rates suggest that the market decline may be bottoming out," said Brian L. Halla, National's president and chief executive, at the time. "But visibility is limited and the outlook for the current quarter is essentially flat with the fourth quarter." Including one-time charges totaling about $159 million, National lost $69.3 million on sales of $510 million for the fourth fiscal quarter 1998. For the entire 1998 fiscal year, National lost $98.6 million on sales of $2,536.7 million, including one-time charges of $72.7 million (see June 12 story). National's own uncertainty is symptomatic of the directionless path of the chip market, analysts said. Furthermore, any argument - positive or negative - is being seized upon by analysts with their own polarized agendas, said A.A. LaFountain, analyst with Needham & Co. in New York. "My own take ... is that we're in the midst of a very protracted 'bottom'," LaFountain said. "If you're looking for a repeat of 1996, you're going to be disappointed."