Intel Corp (INTC)

[DewDiligence]

>> Maybe "amortized" was the wrong word, but the point was that the added R&D for a Banias processor (compared to a Pentium proliferation) won't increase the costs all that much, since Intel intends to sell a lot of them.<<

“Amortized” was the right word. Accounting rules on financial statements and internal analysis which determines product pricing are two different things. Although R&D is expensed on the financial statements, it is very much part of any internal analysis done by INTC (or any other company) in determining product pricing. Although the R&D costs have already been spent, they must eventually be recovered for a product to be financially successful. Agree with wbmw’s statement that the R&D costs per projected unit may be smaller than some other INTC processors.

On the possibility that Banias, in any flavor, can be sold for less than $100 at a profit, we’ll have to agree to disagree. Even after reading your analysis of Banias’ architecture on the TMTA MB, I simply can’t come up with a set of plausible assumptions that leads to a profitable price below $100.

It looks to me (and other TMTA longs) as though INTC is leaving a lot of room for Crusoe/Astro to take root at the low end and mid range of the mobile-device market. Dew