No. of Recommendations: 0
The conventional wisdom comes out and says, "they are a chip company...a chip company...and they have no recurring revenue!"

Another way of looking at recurring revenue is, let us say there is $50B server market and say Intel owns 80% market share then Intel has $40B recurring revenue. Of course, that $40 could move up or move down a bit due to economic cycles, product launch, etc. But dismissing it as no recurring revenue and paying a higher multiple for recurring revenue (which I view as false security in SaaS model, where it is easy to move away) to software companies doesn't make much sense. On the other hand, if you are paying a higher multiple to software companies for their superior margin, lower cap-ex that is a different story.
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