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Intel Corporation Message Board

  • sujit_98 sujit_98 Mar 22, 2013 2:52 PM Flag

    CITI Analyst in conversation with MU

    desperate !!

    Glen Yeung - Citigroup
    Can I just clarify a point, because when I hear your forecast -- not forecast but your statements about ASPs for the quarter in DRAM. Is it right to say that what's really happening is as you take on more Inotera wafers, it actually impacts the ASP increase because of mix but it actually is still contributing solidly to the profitability.

    Mark Durcan - Chief Executive Officer and Director
    Yeah, I think that’s right. There's really two things driving the cumulative impact on ASPs for us. One is the relative [lag] contract spot and the other is the change in our mix that has occurred with the addition of the Inotera increment. Now over time obviously we’ll start moving more of that capacity into value-added segments. But the initial slug of capacity came in the PC area.

    Glen Yeung - Citigroup
    That’s an important point. Second thing Mark, actually just to clarify, you made a statement about channel inventory being very lean. I just wanted to clarify, when you look into distributors, you don’t feel like those guys are trying to build inventory as they sometimes do when pricing is rising and related to that, are you also on allocation for NAND? You suggested you were selling DRAM.

    Mark Durcan - Chief Executive Officer and Director
    The answer to the first question is we don’t think that the distributors are in a good inventory position at this point relative to six, 12 months ago. We think it’s a pretty lean there as well. Quite honestly there is just not that much capacity available for those channels for them to take that position. As it relates to the NAND piece of the equation, there are certainly pockets of NAND that are in tight constraint as well. A lot of that is driven by the production mismatch sometimes what the requirements are on higher density SSDs. So we’re seeing real tough pockets on the [limits] of available supply for some of the SSD categories.

    Glen Yeung - Citigroup
    Just one last quick question. Thinking about the pull that you’re seeing for DRAM from now a variety of end markets, not just normal PC, I wonder if you could rank the end markets now in terms of what areas are pulling DRAM at the greatest or fastest growth rate be it server, networking, mobile or PC.

    Mark Durcan - Chief Executive Officer and Director
    So what we’re seeing in terms of overall raw capacity, it would be -- mobile certainly would be at the top of that list. PCs are probably second when you factor in tablets and it depends where you put tablets in the overall ranking. Server is actually pretty significant. You’ve got single digit growth, but pretty significant server DRAM content growth and that’s becoming more and more of a growth category in terms of bit consumption. And of course you’ve got the automotive and networking as you go down that list.

    Glen Yeung - Citigroup
    Is it fair to say that PC demand, ex tablets, is not so good right now?

    Mark Durcan - Chief Executive Officer and Director
    Yeah, but in balance remember now it’s kind of a science as you just highlighted. When you’re a manufacturer of DRAM you’ve got to make those calls on production based on where those products are going. You can’t just take a mobile bit and make it available a PC guy or vice versa in a given production period. So the unit growth in PC might not be super high, but the balance of PC bits and PC demand is pretty healthy right now.

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