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Politics : Formerly About Applied Materials

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To: Big Bucks who wrote (20875)	6/26/1998 4:26:00 PM
From: Andrew Brockway	Read Replies (2) of 70976

Big Bucks and All, Fujitsu May Mull Getting Out of DRAM Business TOKYO (Reuters) - Japanese electronics maker Fujitsu said today it may consider withdrawing from making dynamic random access memory (DRAM) chips for computers. "We will take a more cautious approach towards DRAMs. We will decide in the future whether or not to continue (the DRAM business)," a company spokesman quoted president Naoyuki Akikusa as saying during an interview with Jiji news agency. Fujitsu is the latest Japanese electronics maker to express a cautious stance towards the volatile DRAM business. A stumbling market for DRAMs -- memory devices used in personal computers (PCs) -- caused plunging revenues at some big electronics makers last business year. Over the past two years, prices of 16-megabit DRAMs, last year's mainstream products, have dropped 90 percent amid a supply glut caused by a global slowdown in PC sales. Among Japan's big five makers, Hitachi and Toshiba both saw group net profits fall about 90 percent in the last business year as losses in the DRAM business cut their profits. Mitsubishi Electric Co suffered its first group net loss in its postwar history. Earlier this year, Mitsubishi Electric said it would move away from the general-use DRAM business, and was looking towards producing more custom-made products, such as logic chips with built-in DRAMs. Hitach said it planned to concentrate its DRAM chip production in certain overseas plants and eventually phase out domestic DRAM output. In June, Texas Instruments of the United States announced a deal with Micron Technology to sell TI's money-losing DRAM business to Micron. Analysts are skeptical of any early recovery in the DRAM business. Many said a price decline of the current mainstay 64- megabit DRAM was gathering speed, making it difficult for any chipmaker to earn a profit.

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