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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: A. A. LaFountain III who wrote (58934)	5/20/1999 1:10:00 PM
From: d e conway	Read Replies (1) \| Respond to of 1583396

<< AMD's progress ... is, on balance, sufficient to put Intel's excessive margins at risk >> Progress? Maybe technical product progress and low-end with no-profit market penetration. In the real world the only thing that matters in the long run is profits. You must be making the assumptive jump that AMD will cease losing money: 1996 loss= $69MM 1997 loss= $21MM 1998 loss=$104MM No company can continue such a pitiful record indefinitely...one false move now and they are toast. Assuming Intel does not cease pricing pressures, how do you envision the turnaround...K7 to the rescue? (As a monopoly-hating consumer and shareholder, I need AMD to succeed). P regards, Dan

To: A. A. LaFountain III who wrote (58934)	5/20/1999 1:27:00 PM
From: kash johal	Respond to of 1583396

Tad, Re: Fab personnell They are basically a fixed cost -except under draconian conditions. They take a long time to train up - so you just can't lay them off when biz takes a dump. And yes the interest expense rate for AMD is a major problem as well the depreciation expense. The billions of dollars in value melt at an alarming rate in this business. The only way to make money is hi-volume. That's the reason all the DRAM guys keep producing DRAMs. They lose less money by producing at 70-80% capacity than by producing less even though they lose money on every DRAM. And they think the turnaround is just around the next quarter once demand catches up. I am hopefull that folks will want the hi speed chips and will be willing to pay high prices for them. If a 500Mhz celeron is good enough next year then it be bad news for AMD and Intel. Regards, Kash