BB and All,
Three stories.
09/25: Applied Materials Says 4th-Quarter Revenue To Exceed $1.2 Billion
SAN FRANCISCO -(Dow Jones)- Applied Materials Inc.'s fourth-quarter revenue will exceed $1.2 billion, Chief Financial Officer Gerald F. Taylor told a gathering of analysts Wednesday.
Taylor, speaking at the Montgomery Securities conference, said the use of copper in semiconductor production is still in the prototype stage. Pilot projects will last another 12 to 18 months with commercial production beginning in 1999 and 2000, he said.
Earlier this month, IBM introduced a new copper chip that is 40% more powerful and 20% to 30% cheaper than current chips using aluminum.
For the fourth quarter ended Oct. 27, 1996, Applied Materials (AMAT), based in Santa Clara, Calif., reported sales of $861 million. For the third quarter ended July 27, 1997, the company reported sales of $1.06 billion.
A First Call survey of 23 analysts forecast fourth-quarter net income of 91 cents a share for the maker of wafer fabrication equipment for the semiconductor industry.
Copyright (c) 1997 Dow Jones & Company, Inc.
All Rights Reserved.
Transmitted: 9/25/97 11:10 AM EDT (L100YuXt)
09/23: Chip-Equipment Makers Glitter After IBM's Copper-Technology News
NEW YORK -(Dow Jones)- Semiconductor-manufacturing equipment makers have come into the spotlight following International Business Machines Corp.'s announcement Monday that it has figured out how to make chips with copper instead of aluminum.
The use of copper, expected to lead to faster and more powerful chips, is an advance that many industry watchers didn't expect so soon.
Benefiting most from the (IBM) news has been Semitool Inc., which makes chip-making equipment and copper-plating products that analysts believe IBM could use in making its new chips. At Tuesday's close, Semitool shares (SMTL) were up $2.625, or 11%, at $26.875, on Nasdaq volume of 2.6 million shares, easily eclipsing the 52-week high of $24.625 set Monday, when the shares soared $5.625, or 30%.
Other chip equipment companies that gained Monday but have since simmered down are Novellus Systems Inc. (NVLS) and Lam Research Corp. (LRCX).
Wall Street analysts are divided on whether it is too early to begin banking on the emerging copper technology.
Sutro & Co. analyst Jerry Fleming argued that a serious production cycle using the new technology is at least two to three years away. He called the market's enthusiasm "a bit premature."
Others argue that IBM's announcement indicates that the semiconductor industry is moving ahead faster than expected, which can only be good for companies that make chip equipment and materials.
Major semiconductor makers have been racing to develop a viable process that uses copper, a significantly better conductor of electric current than aluminum, which the industry has used for nearly 30 years. Researchers have had trouble figuring out how to use copper in tiny circuits and how to use it without corrupting a chip's silicon wafer.
IBM scientists figured out how to affix copper on the chips using a barrier to keep the metal from ruining the silicon. The new chips will be smaller, and therefore faster, as the electronic signals that move through the circuitry will have less distance to travel. It also is believed that IBM's process will lead to high-performance PC chips at prices at least 20% below conventional microprocessors.
SoundView Financial Group Inc. analyst Michael O'Brien initiated coverage of Semitool Tuesday morning with a "buy" recommendation, though he said it was only partially motivated by the IBM development.
"Definitely, the hot buzzword is copper," O'Brien said. "And certainly Semitool is a copper play in the future."
No one is quite sure exactly how IBM cleanly placed copper on a chip, which adds risk to figuring out which semiconductor-equipment company will benefit most from the new process, O'Brien said.
Needham & Co. analyst John Pitzer, who also initiated coverage of Semitool with a "buy" recommendation Tuesday, said he wasn't looking for one big winner in the copper-chip sector.
He sees the emerging technology as capable of supporting "multiple players," including Semitool, Novellus and Applied Materials Inc. (AMAT)
But, he and others see little likelihood that the breakthrough will have a significant impact on industry earnings anytime soon. Semiconductor companies probably will feel pressure to increase their research-and-development spending to catch up with IBM's move, which will benefit the equipment companies in the near-term, he added.
Novellus rose $3.625 Tuesday to close at $124.375; Lam Research gained $1.188 to $55.313; and Applied Materials was up $1 at $100.625. All three are traded on Nasdaq.
Copyright (c) 1997 Dow Jones & Company, Inc.
All Rights Reserved.
Transmitted: 9/23/97 7:54 PM EDT (L100YuKb)
09/25: Surging Electronic Demand Boosted Durable-Goods Orders In August
WASHINGTON -(Dow Jones)- A record surge in demand for electronic equipment was largely responsible for boosting overall orders for durable goods by 2.7% last month, the Commerce Department reported Thursday.
Orders for electronic equipment skyrocketed 28.4% in August, led by increases in computer chips and other electronic components. It was the largest increase in electronic equipment since the Commerce Department began keeping records in 1958. The August rise in electronic orders followed a 12.3% drop in July.
The August increase in overall durable-goods orders, to a seasonally adjusted $186.60 billion, followed a revised 0.1% rise in July. The July change in durable-goods orders previously was estimated as down 0.3%.
The overall August rise was larger than most analysts had expected. Most were looking for a rise of about 1% in overall orders.
The bond market, which has been on a roll lately, responded negatively even though durable-goods data are known for being volatile. At midmorning, the Treasury's long bond was down about 1/2 point, lifting its yield to 6.35%.
Durable-goods data are not adjusted for inflation.
New orders for nondefense capital goods, considered a barometer of future plant and equipment spending, rose 0.9% in August following a 0.4% increase in July. Orders for defense capital goods rose 1.1% in August after dropping 4.7% in July.
Without the defense component, overall new orders for durable goods rose 2.8% last month after rising 0.2% in July.
Orders for transportation equipment rose 5.2% in August, as increases in aircraft and parts more than offset declines in other components.
Excluding the transportation sector, durable-goods orders in August rose 2.0% after increasing 0.9% in July.
Durable-goods shipments in August fell 1.4%, the first decline since May. Unfilled orders rose 1.1% in August, the third increase in four months.
Meanwhile, the Labor Department reported initial claims for state unemployment insurance fell 2,000 in the week ending Sept. 20 to a seasonally-adjusted level of 306,000.
Analysts polled by Dow Jones Newswires this week had, on average, expected claims to increase 7,000 to 313,000. The previous week's jobless claims figure was revised to 308,000 from 306,000.
The four-week moving average, a closely-watched barometer of jobless applications, fell 4,250 in the Sept. 20 week to 312,750.
Continuing claims for the Sept. 13 week dropped 38,000 to 2,217,000 claims.
In the Sept. 13 week, 35 U.S. states and territories reported increases in weekly jobless claims, while 18 reported decreases.
And in a final piece of economic news Thursday, the Commerce Department said the number of building permits issued in August was revised upward to a 1.397 million seasonally adjusted rate, from the 1.391 million rate originally reported. Because of the change, permits were down 1.2% from July, rather than the 1.6% decline originally reported.
Building permits are considered a precursor of future building activity.
Copyright (c) 1997 Dow Jones & Company, Inc.
All Rights Reserved.
Transmitted: 9/25/97 11:06 AM EDT (L100YuWJ) |
