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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (26600)	11/21/1998 11:02:00 PM
From: Justa Werkenstiff	Read Replies (1) \| Respond to of 70976

INTC Capital Spending from GS Summary of INTC Analyst Meeting Like I said, just because INTC is doing well does not mean they will be going capex crazy in 1999. Expense reductions are a big part of bringing it all to the bottom line: " * The cost-cutting effort is surprisingly independent of fab loading, as the materials cost has driven a substantially more variable-cost oriented model. The socketed Celeron (P2 w/integrated L2 cache in a 370 pin socket format instead of slot One) will clearly drive down variable costs significantly. That product ships in January, and there is clearly infrastructure being built for that now as we saw several 370 pin socket motherboards on display at Comdex. The company reiterated that while they had saved over $1 billion in Cap Ex from the reuse strategy in the 0.25 micron transition, the savings could be greater in the 0.18 micron transition since there will be no greenfield fabs in 1999 (as 0.25 micron fabs are transitioned to 0.18). Overhead cost per wafer on 0.18 micron should be substantially lower in the early ramp than the cost was on a 0.25 micron wafer at the same point in the 856 ramp. * The company still has not finalized the budget for 1999 (and it could be up, down, or flat from 98 levels), minimizing capital spending is clearly a major part of the plan."