Did you happen to notice if LSCC was on that list also? BTW, the MOT numbers didn't seem that bad to me either, even though they didn't hit estimates.. Seems to me there still remains a lot to be sorted out, but it was never clear to me that the affected countries were big consumers of semi chips...
The effect that is most important to me is that the COMPETITION for US chips has been reduced, and will remain so for a couple of years. This statement is based on an expected reduction in available capital to the SEA region -- and specifically to the "Tigers" -- with exceptions (Taiwan, eg). Already you are seeing an improvement in DRAM prices... 32 Meg DRAM is up from $40 to $52 in the past week, according to "Jonla", who tracks such stuff. So MU runs up, and TXN benefits.
So, I am expecting to see at LEAST two years of solid growth for U.S. chipmakers so long as the world economy maintains some growth.
And margins will improve dramatically if competition is reduced.
The demand for support resources (test equipment, photomasks, etc) will go on, so I expect to see a secondary recovery in companies like LTXX, VECO, DPMI, AMAT, NVLS, TER, etc.. And that boomlet should also continue for as long as chip demand remains positive.. All in all, Addi, I think a big bet on semis for the next few years is reasonable.
The real action, I suspect will get underway in the second half of '98. All IMHO, of course, and subject to reality checks as needed :-)
TSO |
