John Pitzer, Intel Corporate VP of Planning & IR at Intel Corporation (INTC) BofA Global Technology Conference (Transcript), Jun. 04, 2024
""From an accounting standpoint, the way to think about this, given that we have 51% ownership, we will fully consolidate this through all the way 'to the net income line'. And then as you know, we've got that non-controlling interest line 'after net income' and that's how we reflect both the Brookfield agreement now the Apollo agreement, quite frankly, it also reflects when we sell down Mobileye, when we sell down IMS, everything that we deconsolidated that NCI line before we calculate EPS."
Observation; certainly net, and net after tax covering all costs, is the way intel thinks about paying for things present a production volume requirement.
"Now as you pointed out, consumption last year was about '270 million units for the market. We're pegged this year to like 276 million to 278 million."
Observation; in other word's 100% and AMD is not even a consideration.
"We still think longer-term this PC market is roughly a 300 million-plus or minus unit market. I will remind you that we were at 270 million units of consumption last year." "We're sort of pegging the market to 276 million to 278 million this year, but we were at the low end of seasonality in the first half. And so that will help as far as half-on-half growth."
Observation, confirmation, Intel takes all of it and conceals the inframarginal units that are more and about what AMD aims to produce?
Observation on channel data reconciled on 10-Qs; AMD adds 100 M that is not even considered by Intel producing 400 M units to address AMD?
"And so at the endpoint, the 2030 model, we kind of gave at the Intel consolidated level a 60-40 breakdown between gross margin and operating margin. That's really based on about $100 billion of revenue in that time period."
Observation; I mentioned $100 B in revenue when I did a straight-line depreciation schedule in q4 2021 published on Seeking Alpha.
Looking over my notes in q4 2021 the actual question was with Intel PP&E on a gross basis going from $63.245 billion to $168.342 billion and the number is actually $289 billion on all projects then detailed, how many units would Intel have to produce annually, at a $231 per unit average gross, with all other costs being the same COS 45%, MG&A 8%, R&D 19% that in q2 2024 is low to sustain $167 cost per unit gross basis for Plant, Property, Construction and Equipment.
The answer is 999,000,000 units valued at $230,833,263,157 in revenue.
I offered an intermediate example at $84.171 billion for PC&E sustaining $167 per unit gross. Intel would have to sell 502,740,000 units for $116,165,280,000 in revenue.
Saving grace for Intel is whatever the plant and equipment gross and spreading it out over seven years. Straight lining $289.233 billion over 20 years Intel would depreciate down to $169.638 billion in the 7th year (2028) reaching 2021 level albeit lacking any maintenance add in the 15th year.
On a net basis, on the financial, I have Intel at 309 million units of x86 production in 2023.
Mike Bruzzone, Camp Marketing
Biting the hand that feeds IT
