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To: Amy J who wrote (80975)	5/15/1999 10:53:00 PM
From: Elmer	Read Replies (1) \| Respond to of 186894

Re: "I'm curious how AMD finds capital when they continue to operate at a loss? " Credit Cards! EP

To: Amy J who wrote (80975)	5/15/1999 11:38:00 PM
From: Paul Engel	Respond to of 186894

Amy - Re: "Even if AMD captures 100% of the market share which Cyrix had on the low-end MPU business, is that enough to make AMD profitable" NSM -went on an expensive campaign to build and equip a new 0.18 micron fab, employ multiple design teams that produced essentially NOTHING - and their fab proved a FLOP. AMD is on a similar expansion, I agree - but by getting rid of a lot of their people and focusing on one segment - the low end - they may be able to approach profitability. Getting rid of their Dresden Fab may be required. Re: "?) I'm curious how AMD finds capital when they continue to operate at a loss? " First, the head of DLJ sits on AMD's board and Sanders sits on DLJ's board. This cozy buddy situation was used last year when DLJ pushed $500 MILLION of AMD convertible debt on to its SUCKER clients. Second, AMD is selling off parts of the company - they sold their headquarters and now LEASE-BACK their luxurious Sunnyvale White House, and they sold Vantis - their PLD division. They also have a tremendous debt situation for their Dresden Fab - and their MegaFLop 25 is also "mortgaged" via Senior Debt instruments in which MegaFLop 25 and its contents are pledged as collateral on that debt. Paul