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Technology Stocks : LSI Corporation
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To: uu who wrote (9682)2/10/1998 10:06:00 PM
From: shane forbes  Read Replies (1) of 25814
 
Addi:

I suspect he is talking about the move to 0.25u. And perhaps he is putting a bit of positive spin on this but I do believe overall he is absolutely right!

I recall ATML's Chellam describing the little wheel the suppliers have the semiconductors running on.

(Like the hamsters in a cage running on a wheel that is endlessly spinning - the hamsters are the semiconductor companies and the wheel is the technological changes that the hamsters need to keep moving - if not the hamsters will be eaten up and spat out by the other hamsters around.)

[These hamsters are of the cannabalistic ilk!]

So a nice position to be in if you are a leading edge semi-equip co.

---

BUT

the semi-equips can say all they want but they still need DRAM building and since that's not coming AMAT's orders have to come down.

It's all a matter of scale here. The logic people building will not compensate for the DRAM people stopping.

For the life of me, I just can't see how AMAT's orders will go up over the next 2-3 quarters.

(There is one possibility and that is if AMAT and others can finance the DRAM people. Gut tells me it could happen. But would first need the economies over there to show substantial improvement.)

The semi-equips are expected to go 0-5% growth this year and AMAT will likely be a bit higher. (Though I think the growth may be towards the lower end of this range overall.)

Once again:

NO DRAM fabs
no ORDERs
no equip-STOCKs in sustained advances...

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And check this out:

Dan Mathisson, a trader at D.E. Shaw Securities, said he
expected the report to have an influence on the broader
markets Wednesday. "AMAT is one of the last big
high-flyers in this earnings season and hence it's getting a lot
of attention, " he says.

----
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