Rodney: I like your list, unfortunately the amount of silicon real estate consumed by all these applications together does not come close to the amount of silicon real estate consumed by DRAM. DRAM accounts now for 40% of all chips shipped (dollar wise), but the low price per dram (compared to the cost of the chips in your list) make the real estate occupied by drams a much larger percentage, I do not have that number handy, it used to be 60%, and today it could even be 65%, thus the reasoning why the dram business drives WFR's business. Take into account that only recently WFR was certified to be a supplier to Intel, and you can see why in the case of WFR, the dram business is so important.
I was quite happy, at first, seeing the BTB go to 1.1, but when I started to look at the details, it become quite obvious that the upturn in the semi is not yet around the corner. Our monthly billing rate is still way below last year billing rate (4.7 vs 3.7 Bill/month roughly). The one little ray of light is that the low shipping rate does not mean low silicon consumption, since here, once again, the price deterioration in dram means you need many more chips for the same volume. Of course, the die size reduction and increase of average wafer size toward to 200 mm, act both to reduce the demand for wafers. All together, I am still of the opinion that WFR's rally, is a rally within a bear market (as I satetd after the decline to 17, when I said to expect a rally to the low 20' and forget about WFR until next June after that. Of course, conditions may change, and I have been wrong before.
My long term view of WFR (end of century having reached 100) has not changed.
Zeev |
