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Politics : Formerly About Applied Materials
AMAT 327.01+2.5%Jan 16 9:30 AM EST
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To: Ramsey Su who wrote (26679)11/24/1998 3:19:00 PM
From: blake_paterson  Read Replies (1) of 70976
 
Ramsey: OK, I'll try to keep them simpler so as to not overwhelm your thought process <VBG>.

re: capex. Intel has already made it clear that they intend to decrease capex to ~ $2.5 billion this coming year (this down from $3.5 billion on actual equip purchases (after eliminating fab acqs/invests)). In order to accomplish this reduction while simultaneously increasing output (haven't you heard about all of the new chip shortages <g>?), they will recycle used equip and focus on die shrinks. That means that they will shift their spending focus to equip which facilitates 0.18, and any vendor w/ a leg up in this area will benefit. So there will be a redistribution of purchasing activity, away from the IPEC's of the world (why'ddya think they just sold out fer cheap?) to the 1000# gorillas (AMAT, KLAC) and a some choice smaller vendors w/ strategically important technology. Does that mean that the world has come to an end? Of course not. Intel, important as it is, is not the be all or end all for the semi-equip mfrs. The dynamics of the industry have certainly changed as has the flow of purchasing dollars, and that is where some investors win and some lose.

Short enough for you? Regards and JMHO,

BP
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