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Politics : Formerly About Applied Materials

AMAT 249.89

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Nov 26 3:59 PM EST

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To: Gottfried who wrote (20896)	6/26/1998 9:24:00 PM
From: Ramsey Su	Read Replies (1) of 70976

GM, may be this article is a little more definitive than earlier ones. Ramsey TOKYO (Nikkei)-Fujitsu Ltd. plans to trim back its conventional DRAM chip production, switching to specialty DRAMs which are more profitable, company sources said. Semiconductor earnings have slumped due to falling prices of conventional DRAM chips since early 1996. The aim is to cut back conventional personal computer DRAM operations to less than half of overall DRAM operations by fiscal 2000, from nearly 80% at the moment. Instead, Fujitsu will boost operations of profitable DRAMs for 3-D graphics, hoping for a quick boost to chip earnings. DRAM production in the Fujitsu group reached some 110 billion yen in the year ended March. But the price of 64-megabit DRAMs has already halved since the start of January. Fujitsu officials see little prospect of the situation improving, given the slump in PC demand and the large-scale production planned by U.S. chipmaker Micron Technology Inc. and Kobe Steel Ltd. (5406) next year. DRAMs are projected to account for 17% of Fujitsu's overall production in the current fiscal year through March 1999. That's the smallest proportion of any of the five largest computer makers. Falling DRAM prices are, however, expected to result in a group net loss of some 30-40 billion yen in the year. (The Nihon Keizai Shimbun Saturday morning edition)

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