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To: Proud_Infidel who wrote (49974)7/31/2001 2:15:31 PM
From: Proud_Infidel
   of 70976
 
1:18PM Applied Materials (AMAT) 47.24 +0.65 (+1.4%): -- Technical -- Struggling over the last three sessions to break solid resistance (trendline, mid-month high, 200 day simple ma). Has edged slightly above with next resistance at the top of the July 6 gap at 48.41. Secondary resistance is at 49 (50/100 simple ma). Sustained breach of trendline bolsters the intermediate term outlook.

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To: Proud_Infidel who wrote (49988)7/31/2001 2:16:18 PM
From: Proud_Infidel
   of 70976
 
NEC plans major cutbacks in chip production

By Jack Robertson
EBN
(07/31/01 12:57 p.m. EST)

NEC Corp. Tuesday continued to shake up its loss-plagued semiconductor group by closing aging 6-inch wafer lines in Japan, cutting production in half at its Scotland fab, and merging chip assembly operations, resulting in a loss of 4,000 jobs.

Last week NEC reported a $140 million operating loss in its Electron Devices group in the first fiscal quarter ended June 30.

The scale back comes only four days after NEC announced it was spinning out its optoelectronic and microwave components operation into a separate subsidiary.

The chip firm also continued to cut its semiconductor capex spending this fiscal year, now planning a 50% reduction to $975 million.

The firm also disclosed it will shift control of its existing DRAM production at its Hiroshima fab by 2004 to Elpida Memory Inc., its joint venture with Hitachi Ltd. The Hiroshima fab currently acts as a foundry making DRAMs for Elpida, butNEC officials said they want to be out of all DRAM production in three years.

The chip plant cutbacks revealed that NEC, like many Japanese firms has resorted to using a large number of contract workers for lower costs and to avoid the lifetime employment commitment for regular company personnel. NEC said half of the 4,000 job reduction involves contract employees.

NEC detailed its earlier-indicated cutbacks at its Livingston, Scotland fab, announcing nearly a 50% cutback in production to 15,000 wafers a month in the second half. The work force will be reduced from 1,600 to less than 1,000.

The cutbacks also include closing a 6-inch fab line at its Sagamihara facility, which will be consolidated into an 8-inch line at the fab. In addition NEC said, "other domestic 6-inch fab lines at other sites will be shifted to 8-inch lines at these locations."

Three chip assembly plants in Japan will be consolidated into a single operation, NEC Semiconductors Kyushu Ltd., to be established in October. Two other assembly plants at Yamagata and Takahata will be merged into one unspecified location in the second half.

NEC reiterated that a planned production expansion will be frozen at its joint venture fab in Shanghai, Hua Hong NEC Electronics Co. Output will remain at 20,000 wafers a month at the Chinese fab.

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To: Shoibal Datta who wrote (49987)7/31/2001 2:24:47 PM
From: Joseph Beltran
   of 70976
 
Gerard Klauer Mattison: That's a wine making outfit, isn't it? Do they moonlight as analysts?

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To: Joseph Beltran who wrote (49990)7/31/2001 2:33:29 PM
From: advocatedevil
   of 70976
 
Hey Joseph, U slammin' my newest bestest friend? <g>

BTW, I think the tape-painters are hard at work today. I expect they'll come out on top at the close (but I'd be highly surprised if the SOX were to return to the highs of the day).

AdvocateDevil

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To: Joseph Beltran who wrote (49990)7/31/2001 2:46:32 PM
From: michael97123
   of 70976
 
Bear Killer,
We need a win today at 4pm. We need a booming last hour. Odds definitely against us for that outcome. mike

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To: Joseph Beltran who wrote (49990)7/31/2001 2:51:50 PM
From: michael97123
   of 70976
 
No, proctologists!

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To: michael97123 who wrote (49992)7/31/2001 4:04:06 PM
From: Math Junkie
   of 70976
 
Who's "we," paleface? <G>

(Waiting for my covered calls to go down so I can buy them back cheaper.)

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To: Shoibal Datta who wrote (49987)7/31/2001 7:01:38 PM
From: Cary Salsberg
   of 70976
 
This report "doesn't compute!"

1. "...capital equipment spending to fall 27 pct in 2001 and 17 pct in 2002."

2."...sales for the full year at 7.19 bln usd, down from 7.24 bln, while they anticipate 2002 sales of 7.2 bln usd... "

Yahoo research has consensus revenues 1.3B this Q, 1.4B next and 7.2B for 2001. If spending continues to fall in 2002 and AMAT's fiscal year ends in October 2002, one would think that AMAT would be doing well to continue at the 1.3-1.4 quaterly rate That gives 5.2-5.6B, a far cry from the 7.2B forecast. AMAT forecast breakeven for this quarter. If revenues stay down, I doubt they can make the $0.85 forecast by cutting costs.

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To: Shoibal Datta who wrote (49987)7/31/2001 7:50:50 PM
From: advocatedevil
   of 70976
 
FWIW, I listened to the lengthy KLAC year-end CC this afternoon and was less than impressed. While the various earnings related press releases appeared somewhat positive, the bottom-line IMO is that KLAC is expecting to be flat to down 10% next quarter and will not estimate when an up-trend might begin. I'd be very surprised if the market will take this puppy up tomorrow. ("short" sigh of relief)

AdvocateDevil

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To: Shoibal Datta who wrote (49987)7/31/2001 8:47:40 PM
From: Jacob Snyder
   of 70976
 
re: we believe the capital equipment industry will not start to pick up until 2003

When that becomes the consensus, it will be time to start buying the semiequips.

Right now, I think the market's consensus is that chip demand, and semiequip bookings, will pick up by the end of 2001.

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