UBS Presentation highlights:
- Mirrorbit - 71% of revenue
- Spansion has 32% market share year to date
- strong unit growth, ASP difficult (slides have not been posted)
- capitalization of Numonyx gives us indication that they are not capitalized to make an investment in 300mm capability
- Spansion has a head start on 300mm
- supply reduction - supply taken out as a result of the consolidation (of STM and Intel)
- normally ASP per megabit typically 6% reduction QOQ
- Q1 -12%, Q2 -18%, Q3 +7% (influenced by higher densities, but down 3-5% per megabit) - ASP stabilizing
- Q3 built $611M, booked $790M of new orders - good backlog for Q4 and beginning of Q1
- looks like a good Q4 - but Q4 is normally good
- positioned itself with inventories, expect strong demand through 1st hals of Q1
- impact of 300mm per die 25% cost reduction
- node migration, 30% cost reduction
- 1B cap ex invested in a down cycle to differenciate themsleves
- liquidity: $530M at the end of Q3, $200M available on credit line, some revolver capacity, generated $70M of cash flow generated in both Q2 and Q3, expected to pick up $80M from acquisition of Seifun
- over next 4 quarters, expect $1.2B of liquidity
- 2008 max capex of $700M. Byt cautions until seeing better operating results, but have liquidity is there to do what they need to do
- debt structure: maturities starting in 2013, ample time to see returns from SP1
- Saifun takeover - vertical integration
- execting to enter technology licensing
- 70% cost front end 30% back end. Node migration, 300mm influences front end, BIST will influence back end.
Q/A:
BIST - 30% cost reduction of 30% back end cost
SMIC - foundry relationship - will license SMIC to sell Quad Bit in China
Samsung - was aggressive in H1 in China - subdued in Q3. Samsung is the competitor to keep an eye on. But they have a competitive conflict with customers. Samsung has a separate NOR capacity (not shared with DRAM and NAND) - old fab, and the capacity is apparently filled.
45nm, phase change: (I don't know if I got this right) Competitors are planning to move no phase change for 45nm - die sizes will be bigger than Spansion NOR - may not be commercially competitive with Spansion.
investor.spansion.com
Joe |
