AMD strictly moderated (AMD)

[bobs10]

you...

Yeah, $20M charge is about right-- shouldn't come as a surprise, as the 10-Q/Ks have noted the prepayment penalty schedule: principal + interest (that part is fine, no charge) + an extra 7.75% of principal for paying it off in this particular timeframe. That works out to over $16M on this $210M of principal. The rest must be this fee or that fee.

me...

Yeah, as I keep saying earnings at turning points, either on the way up or down, are not good indicators of a company’s health. For companies turning up that is especially true as they have lots of things to spend money on that have been deferred. Cleaning up ones finances is an especially popular application of funds if for no other reason than every company AMD does business with looks at them. Say AMD is telling a company that it will be able to meet its' demand for processors in the future because AMD is going to be building fab38. It's easy for the company to take a look at AMD's finances and determine how real that assertion is. There are plenty of other reasons for wanting a strong set of financial statements also.

These issues are really sideshows, nothing more than trading one asset for another. The big things are the capacity and demand issues, which are now coming into alignment with Aquarius, and hence peace will soon rule the planets etc. etc.

Still, it is important that everyone understands the price being paid, and this probably isn't the last of these one-time charge items we'll be seeing. Thanks for doing the digging.