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

To: Mary Cluney who wrote (72975)	2/5/1999 10:03:00 AM
From: Burt Masnick	Read Replies (1) \| Respond to of 186894

Friday February 5 12:26 AM ET Advanced Micro Sees Possible Q1 Operating Loss SUNNYVALE, Calif. (Reuters) - Chip maker Advanced Micro Devices Inc. (NYSE:AMD - news) said Thursday that it could incur an operating loss in its current first quarter, in light of accelerated chip price cuts by its main rival Intel Corp. (Nasdaq:INTC - news) The news confirmed what many analysts had begun to speculate late Wednesday and early Thursday, after AMD cancelled two upcoming presentations at technology investment conferences, fueling a sharp drop in its shares in two days. Earlier Thursday, some analysts had already begun cutting 1999 earnings estimates, or warned that AMD might see an earnings shortfall, due to an increasingly tough price war with Intel. ''The competition is big, mean and great,'' said Scott Allen, a spokesman for Sunnyvale, Calif.-based AMD. But he added that AMD plans to further enrich its product mix going forward with chips like the K6-3 and others. ''We believe we are looking at a one quarter event,'' he said. Allen said that AMD's K6-3 chip, which will compete directly with Intel's upcoming Pentium III chip, is on schedule and should be in systems on retail shelves at the end of the first quarter or the beginning of the second quarter. Intel, which was a late-comer to the low-end PC market, has recently come on strong with its Celeron processor designed for PCs costing $1,200 and below. In a move to gain back lost market share in that segment of the market, Intel has moved up new product launches and price cuts in the Celeron family. In a statement issued before the stock market closed, AMD said that, based on a reassessment of current business conditions, it could incur an operating loss in the quarter. AMD said that, with Intel's recent acceleration of its price cuts and the expectations for its new Pentium III products, it is reassessing its competitive response. ''The likely outcome is that, in spite of the planned richer mix, we will be unable to increase our microprocessor average selling prices in the current quarter,'' W.J. (Jerry) Sanders, chairman and chief executive, said in a statement. AMD shares tumbled earlier before they were halted from trading on the New York Stock Exchange, pending news. AMD shares fell $2.0625 to $18.875 Thursday and were the second most active stock on the NYSE. Analysts had been forecasting that AMD would report earnings of 13 cents per share for the first quarter, versus a loss of 39 cents in the year-ago quarter, according to the consensus provided by First Call. AMD also said that, while it has completed the design enhancements to increase the volume production of its K6-2 processor with advanced multimedia functions, it will not realize the benefits of the production change until the second half of the first quarter. The company also said its inability to increase average selling prices in the current quarter will put more pressure on its gross profit margins. Some analysts have said the average selling price for AMD's K62 processor is declining about 30 percent in the current March quarter, to $60 from about $88 in the December quarter, and will fall to $50 by the summer. ''I don't think the K62 and the K63 will materially contribute to the bottom line because ASPs (average selling prices) are heading down a cliff,'' said Ashok Kumar, an analyst at Piper Jaffray, adding that, in the December quarter, the microprocessor division was 67 percent of AMD's total revenues and almost all of its profits. ''Now the microprocessor division is not contributing to profits at all,'' Kumar said. ''Clearly they will have to do some soul-searching and cut divisions that do not show any signs of a turnaround.''

To: Mary Cluney who wrote (72975)	2/5/1999 10:44:00 AM
From: herb will	Respond to of 186894

Mary: According to the Fabulous Market Babe, “As for the reasons behind Kurlak, with his tunnel vision, not pointing out the above, I'll let you be creative and fill in the blank on that one.” A guy, Tom Kurlack, cuts Intel's 99 earnings by a whopping 3.2% and umpteen millions shares are dumped with over an 8 point drop for the day. Well,my filler inner is working overtime! Herb

To: Mary Cluney who wrote (72975)	2/5/1999 12:03:00 PM
From: limtex	Read Replies (2) \| Respond to of 186894

Mary - Mr K certainly has an effect on the stock. He really doesn't seem to like the idea of INTC stock price going up. Still I suppose he's happy now and can look good in front of his peers. Given that there is nothing to encourage buying I suppose we have to get used to the fact that the NAZ is in Titanic mode yet again and that INTC is on its merry way to well below $100. Time to batteen down the hatches, and wait for the next Q results to show once again that Mr K was wrong. Good luck to him in the meantime. Regards, L

To: Mary Cluney who wrote (72975)	2/6/1999 11:54:00 AM
From: Thomas G. Busillo	Read Replies (1) \| Respond to of 186894

Mary, what an awesome site! I've been there now and then, but that just became a must-read for me. That yellow smiley(frowning) face on the index page right next to "The Curse of Kurlak" - I can't stop looking at it or laughing. I keep moving from the smiley face, to the word "Kurlak", then to that lightbulb gif a little further down, then back up... fabmktbabe.com In theory, you'd think the lightbulb would go with the article about the comments of the reigning II "All-Star" on the chip group. And the fact that the bulb appeared to have burned out on this guy long-ago is what makes it funnier. It's also a great piece on INTC. I don't know what the stock's going to do, but that's a great summary of their product strategy on CPU's and it's great that she's also highlighting that while INTC may derive the bulk of its revs from CPU's, there are growth opportunities in other branches of their business. Good trading, Tom