There is a lot more to the processor business than selling processors. Controlling the supply chain and controlling product offerings is almost more important. And it's not just the supply chain, it's their manufacturing ability. They are way ahead in terms of manufacturing ability and economies of scale.
The timing of this reset relative to current stock prices is not a prediction of further weakness.
Maybe you can make another 50 percent from here, but people are skittish, ... The problem in this market is that everyone's looking for the momentum play. Any sort of fear that a company isn't going to be able to sustain a momentum ends up a reason to dump shares.
If I'm one of the investors that got in early, I'm going to take some off the table, ... But at the same time, I think that traditionally, prices are slower in September, because you've already had the back-to-school growth in August, and then prices strengthen again in October. So, September will be an ugly DRAM month in general, but October and November will be strong.
Flash and processors are more viable as separate companies.
People are less likely to travel to Hong Kong but does that mean business is slow because of that? No, it's because the economy hasn't picked up.
HP's best business is printing and imaging and the company diluted that by buying Compaq.
Inventories were getting burned down heavily in January and February and that should continue into March. Chip shipments should be reflecting true demand in the second quarter.
The worst of the news is behind us and if people think the sector will bounce back, investors will buy stocks ahead of that.
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