*AV* AMAT
AMAT is the big bad wolf out in the semiconductor equipment sector. They are ~$4 billion in revenues strong and have the money to do what they please in the equipment sector. They gobbled up 2 companies recently, Opal and Orbot which are more or less diagnostic tools versus manufacturing tools. I believe the Orbot product would give KLAC serious competition in the marketplace once AMAT's financial and marjeting resources were assigned to the Orbot product. To this end, I beleive yesterday's merger announcement of LRCX/NVLS was their attempt at keeping the wolf at bay. Combining the resources of these two companies will make the surviving entity stronger. This is what will be necessary to compete with AMAT.
AMAT, IMHO, is agressively trying to corner the market in the equipment sector to allow it to be the primary supplier of equipment for all areas of the manufacturing process. To do this, they need to acquire certain other functional equipment areas. My take is that it is looking for lithography equipment acquisitions to round out its portfolio of products. With this done, they have essentially become a one stop shopping center for putting a turn key manufacturing facility together.
INTC when it builds its new fabs will be using a great deal of AMAT equipment. However, if AMAT succeeds with its "plan to take over the universe", it is feasible that INTC or another semi company could call up a conference between INTC, AMAT, and a Design/Construction company and negotiate a turn key manufacturing facility.
Besides being a good to great equipment provider, AMAT deserves a great deal of credit for its process knowledge. AMAT is one of the few equipment providers that have superior applications engineering and technical support. They really do understand IC wafer manufacturing and processing. They have personnel and applications labs to support the development of process modules for the end user. They have a great rapport with many end users such that co-developed processes are quickly made available to the general environment. Basically AMAT is capable of delivering both the equipment and the process. This is a strong point.
INTC is the ruler of the Microprocessor world with some painful distractions in the form of other "competitors". However, INTC has its modems, motherboards, horded DRAM for a while, put MMX on board (reducing reliance on other comapnies for basic sound card peripheral boards), etal. I have even heard it rumored that INTC actually had or was planning to have its own PC.
My comparison to INTC is as such.
INTC is the PC/Microprocessor industry
MSFT is the Software industry
AMAT is the semiconductor equipment industry
DELL is the Computer Industry
All 4 are obviously exaggerations of reality, but not by much. Any one of the 4 sneezes and the market has a heart attack. |
