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 : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: yard_man who wrote (43957)	1/19/1999 5:25:00 PM
From: SeaViewer	Read Replies (1) \| Respond to of 132070

Why is WDC laying off some folks WDC just announced (.93). The company specifically pointed out in its announcement that it is beating the estimate, which is (.99). If you read the balance sheet, you can find that the common shareholder equity is less than $900k. I am not surprised by MSFT's number. Gates and Co. can beat the number easily because they don't need to worried about margin sqeeze. As long as PC unit sale is good, they can collect the money. Jeff

To: yard_man who wrote (43957)	1/19/1999 9:03:00 PM
From: gbh	Read Replies (1) \| Respond to of 132070

In typical bull fashion you mention only those that surprise to the upside. Gimmee a break. Actually, I was just throwing out the names that were popping on my screen for previous 30 minutes. And these names do happen to represent a decent cross section of all of "tech". Not just PCs. The PC market healthy? Huh? INTC profits down 13% year over year to the last year? Sales growth of 5% on quickly eroding margins. INTC has turned the corner. This is more clear now than yesterday. Your selection of poor year over year profits and sales growth is the reason why INTC was stagnant for most of that year. But the market looks forward. In that regard, fourth quarter net income was up 18 percent from fourth quarter 1997 net income of $1.7 billion and net income in the fourth quarter was up 32 percent from third quarter 1998 net income. It seems to me (and the street), that this was a breakout quarter. Unfortunately, the market doesn't sit around and wait for its future views to come true before running prices up. People place their bets and sometimes win and sometimes loose. Or maybe some just refuse to bet... What happened to IM, ICO, MUEI? Why is OMX taking a charge to deal with inventory that must be sold at a loss? Actually, IM simply missed estimates. Growth was actually pretty good, considering the the whole reseller industry will have even more problems going forward. One of these days CPQ will actually figure out that the DELL/GTW model is the only to sell to business. In the mean time, I refuse to use these guys to "gauge" the industry. It just doesn't make sense, with "direct" being the wave of the future (except DELL and GTW of course) Also, MUEI is a turn around situation, and at best a 50-50 shot to be a survivor going forward. And OMX? Please, you give me a break<g>. Where is the new investment in the equip that produces the chips? NVLS reported today that sales were down sequentially a whopping 35% from last quarter. AMAT laid off a bunch of folks because the have so much work, eh? It appears these guys will be the last to recover. INTCs spending was down in 98 and will be again this year. The same will also certainly be true of the big Korean and Japanese DRAM guys. But you must remember the huge run all the equipment guys made in 96 and 97 due to overspending (hindsight). This industry is so cyclical its not even funny. It will takes another good quarter or two from the chips guys before spending kicks in again. Or perhaps the chips guys are just getting smarter and yielding much better, and therefore requiring less equipment. This seems to be the case INTC, but maybe not AMD. Kind of a weak argument on my part, but its a mistake on your part to simply look at the semi-equip guys and say the industry in unhealthy. Its way more complex than that. What has softie really given us lately that is new and must have? Repackage the same ole' and with most of the market sewed up, they tweak a little here and a little there call it new and sell it with every new PC -- this is one of the last bastions of profitability related to the industry. Softie has given us nothing. Win98 is a joke. A bug fix release for the most part. But thats not the point. The quarter over quarter and year over year growth is the point. If this isn't the most obvious indicator of industry health, I don't know what is. There will always be "haves" and "have nots", but like you just said, since every new PC has msft, and msft is growing .... Same ole, same ole, to me. What happened to the disk drive sector -- are they still trading at all-time highs? Why is WDC laying off some folks? And you left your weakest for last. WDC? How about SEG, MXTR and IBM. Not to mention QNTM is expected to have a good quarter. This industry has turned. WDC may, unfortunately, be the casualty. I don't expect them to survive, on their own. Gary