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Gigaman says-- You seem to think that Intel's most important goal is to squash AMD. Actually, It is to make as much money as possible. Something they seem to have no problem doing, or did you not see that Intel increased profits by 37% over last year in Q1 and are looking at 40% increase in profits for all of 2000.

Here we go again. I've pointed this out before, but since you continue to bring this up on the AMD board I want to show the numbers that intel posted for Q1 of 1999 and 2000 again.

Please check them for yourself here:
http://www.intc.com/pressroom/archive/releases/cn041800.htm

Q1,2000 Q1,1999
NET REVENUE $ 8,021 $ 7,103
----------------------------------
OPERATING INCOME 2,607 2,637
Interest and other 640 347
----------------------------------
INCOME BEFORE TAXES 3,247 2,984
Income taxes 515 985
----------------------------------
NET INCOME $ 2,732 $ 1,999

Please look at the OPERATING INCOME line in bold. Compare it with the net revenue. What is wrong with this? Looks to me like intel is losing a handle on its operating costs and expenses. (Check the link for details.)

What's the result? Intel actually had higher OPERATING INCOME in Q1 of last year compared with this year. Didn't you just say intel's number one priority was to make as much money as possible? Is this some new strategy from Intel's CEO? It doesn't look too impressive to me.

Yes Intel may have grown NET INCOME 36.6% if you add the extra sale of securities and include the tax break they received.

But, the fact remains, that intel's OPERATING INCOME from the sale of goods it manufactures actually dropped from last year!

We all know the "Wonders" of Intel Capital. I'm not disputing that. But the performance of the CEO in managing Intel's core business was poor at best! And from the price action we are witnessing on the street, I'd say there are a lot of other investors who were not impressed either.

Just to throw out some more numbers here's the results from the Intel Architecture Business Group:

Q1'00 Q4'00 Q1'99
Revenues 6,609 6,955 6,429
Operating profit 3,065 3,318 2,944

Blah! Where is the amazing growth in these numbers?

What about these numbers from the "All other" category?

Q1'00 Q4'99 Q1'99
Revenues 1,412 1,257 674
Operating loss (458) (564) (307)

At least they are growing revenues in their new and exciting ventures. Only red flag I see is that intel's loss has grown YOY. Doesn't impress me, but different strokes for different folks I guess.

I know TMFGrape plugged some numbers into some Fool formulas for "Rule Makers" (or some such thing) and everything turned up rosy, but I'm not impressed by declining operating profits and increasing losses in their new product ventures.

Maybe they'll phase out of processors in the future, and make all their money investing in the stock market and selling stuff from their "All Other" category which will "hopefully" turn a profit some day. But right now, I don't feel like this company is a good investment based on their current performance. And it doesn't matter to me how many billions of dollars they have in the bank to shore up the lagging sales in their core industry. Until I see an improvement in their processor division I will be avoiding this stock.

So, since you think that if a company is posting record earnings that it's CEO should be fired because of supply problems - --Gigaman

I wasn't the one who suggested firing the CEO, but I thought I might as well chime in here too. Frankly, I'd like the guy to stick around! It certainly hasn't hurt AMD. But, if intel is going to convert themselves into a new company devoted to businesses outside the microprocessor arena, my first suggestion would be to promote the guy in charge of Intel Capital to the position of CEO. From what the numbers tell me, he is the only person capable of growing profits for the company. (Well, except maybe their tax lawyers.)

To wrap this thing up. I promise I'll never post this on the "Serious Investor" board because I'm aware that it is only a happy-happy joy-joy intel love fest. I only post on the AMD board anyway, simply because I'm not interested in buying Intel stock at this time. I just wanted to make sure other shareholders of AMD realized the accounting acrobatics intel had to perform to realize their 36.6% gain in earnings YOY. I am glad that you posted though because it has helped me to reaffirm my long position in AMD.

One last point. Probably the most important number that should concern AMD investors from Intel's quarterly report is Intel's growth in microprocessor revenues YOY.

That number was a measly: 2.8%

For comparison AMD's grew:63.0%


-XKRed27
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