Intel Corp (INTC)

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Found it...Q4'13 earnings call:

Mark Lipacis - Jefferies

Thank you and if I could have a follow-up, there has been some news report about the Fab 42, could you help us understand what’s going on? How we should think about what’s going on there? Thank you.

Brian Krzanich

Sure I will start and then Stacy can talk to you about the financial discussion of it. You know you start these construction projects, we talked about in the past, yes it starts three years roughly in advance. They are very complex, some of the most complex if not the most complex construction projects you could imagine. If you start those three years in advance so when you’re ready for operation. We started this one about three years ago, if you go back and look three years ago our view of the PC Industry and PC growth it was you know much more robust than what has played out and is our forecast today and so what we have done as we have brought it online as we have been very conservative with our how we manage the project, we brought it up and so the shell is complete and facilitating from a construction standpoint and we have held back putting equipment in and so we see the demand requirement and that’s really what we have done. We’ve done that in the past, you can I have been in Intel’s manufacturing for 30 years. You can go back in time and we did that fairly frequently and that’s what we have done with Fab 42 as well. We have held it back until the demand requirement comes about.

Stacy Smith

Well don’t have a lot to add to that. I would just say that that financial impact of this is actually pretty minimal. As Brian said we have built a shell but we didn’t equip it and we did that before we needed we will ultimately use it to the economic cost is just time value of the money which is pretty modest cost and this is pretty normal for us since, we actually always want to have some preposition space to grow into as the market grows. As Brian said it's three years to construct one of these things so it's economically quite detrimental to get cut short and the cost of having all those extra spaces is pretty high. Doesn’t impact depreciation, doesn’t impact gross margin.

http://seekingalpha.com/article/1951011-intels-ceo-discusses-q4-2013-results-earnings-call-transcript?part=single