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Technology Stocks : Newbridge Networks -- Ignore unavailable to you. Want to Upgrade?

To: MD Bryant who wrote (6971)	10/13/1998 9:41:00 PM
From: pat mudge	Respond to of 18016

Not directly related to NN, but certainly a bellwether to the entire tech sector, Intel held its quarterly cc this afternoon. intel.audionet.com Highlights from my notes: * new records in revenues and shipments * 3 of 4 geographical areas had solid growth, slight decline in Japan * inventories dropped in days held * Celeron (?) processor had 4X volume growth -- "extremely pleased" * growth in networking products --- record quarterly revenues Q&A Q: Shape of demand? (Don't you love analysts questions?) A: Q4 always depends on Sept. Growth picked up [after Aug.] and has maintained its pace. Q: You've estimated 3% growth. Any room for upward revisions? A: Of course. That's always possible. Right now we're trying to rebuild inventories so we can respond to customer needs. Q: Capital expenditures for '99? A: Figures available in January Q: What challenges in 4Q? A: Biggest demand is to produce enough to meet customers' needs. Q: Situation in Japan for '99? A: We've seen it bouncing along. . . don't see it changing in foreseeable future. Q: Xeon chip --- short supply? A: Struggling to catch up to demand. Pretty good shape now. Four-way and above out of constraint in a month or so. Q: Visibility for Q4 --- turns and so on? A: Distributors want more product (dist. rep. 1/3 sales) OEMs want product early; direct sales want as needed. Q: [Something about US vs. Europe --- hard to hear question] A: 4Q is peak for Europe. That will continue. Q: Celeron up 4X --- will this affect the growth of Pentium II? A: Celeron will replace the Pentium processor eventually --- not completed yet. Priced at the low end of PentII --- want to show customers reasons to buy up. Q: Q4 growth? Ordering closer to need? A: In general inventory better than year ago. Pipelines thinner and shorter. Q: Drivers for '99? A: 1) upmarket servers and workstations, 2) U.S/Europe Internet trend, and 3) Asia and Japan --- hoping they'll pop back, but still wait and see. Q: Why caution in Q4 guidance? A: We look at orders and normal turns rate and see Q3 good and think Q4 good, too. Q: Comment on GMs up slightly? A: If revenues are up slightly, then gross margins will be up slightly. Q: Backlog? A: Little backlog, yes. Q: Expenses, where? A: 3Q bigger advertising costs. Build R&D a little. [Kurlack] Q: ASP issue: if operating profits are down in dollars by 6% and revs are up 9%, how come flat? A: Change is attributable to change in parts [costs] of new products. Q: Xeon ramp? A: Happy with acceptance. Extremely pleased with benchmarks on high-end -- very good re: production in '99. Q: How ASPs flat for 5 Qs? A: Memory pricing a factor. Heart of the answer is our segmentation strategy --- working each segment. Growth at high-end balancing less at low-end. Q: Orders staying at high end of September? A: Year ago inventory problems --- now steady backlog relative to demand. Q: Market share? A: No guidance. Q: Feedback from different customers regarding strength of markets? A: I'd rather you ask them. Q: Fastest growing revenue segment? A: Xeon PentII, Celeron also. Q: Acquisition rumors? A: no comment --- will pass on that one. Q: Head counts? A: No more forced attrition. Not a big number. Q: .18-micron -- what percentage can we see 1st half, 2nd half? A: First half negligible; second half small. Q: Capital equipment in '99? A: .18-micron requires capital equipment; Buying some for next generation .13. At that the session ended abruptly. Perhaps they had a set amount of time. If any of my comments don't make sense, you can clarify by calling 402-220-0880. Press 9 for fast-forward; 8 for pause; and 7 for 30 seconds backwards. That's it for now. Pat