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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (34290)	2/16/2000 7:33:00 PM
From: Donald B. Fuller	Respond to of 70976

Applied hikes fab gear forecast to 46% growth in 2000 By J. Robert Lineback Semiconductor Business News (02/16/00, 08:35:24 AM EDT) SANTA CLARA, Calif. -- Encouraged by record new orders for chip-processing tools, Applied Materials Inc. here has increased its industry forecast for sales growth in wafer fab equipment to 46% this year vs. its previous projection of 19% three months ago. "In the near term--the second [fiscal] quarter--we expect [Applied's] new orders to be up again sequentially to at least $2.5 billion," said Joseph R. Bronson, senior vice president and chief financial officer at Applied Materials, during a conference call with analysts following Tuesday's release of record quarterly results. Applied beat Wall Street's expectations, posting a net income of $328 million on record sales of $1.67 billion in the company's first fiscal quarter, ended Jan. 31. The semiconductor equipment giant reported record new orders for systems at $2.36 billion in the period, a 43% increase over $1.65 billion in the previous quarter (see Feb. 15 story). Looking ahead, Bronson and Applied chairman James C. Morgan told financial analysts that the global market for semiconductor equipment continues to outpace previous estimates and orders are expected to remain robust for the next couple of quarters. Bronson said Applied now expects to have net sales of $2.0 billion to $2.1 billion in the current fiscal quarter, which ends April 30. He added that earnings per share in the quarter are expected to be in the $1.00 to $1.08 range--significantly higher than analysts' estimates of $0.84 prior to Tuesday's conference call. Applied's outlook--along with other semiconductor equipment suppliers--continues to grow stronger as chip makers begin to add new capacity and invest in next-generation fab technologies. "The industry plans to have approximately 13 new 8-inch fabs on line in 2000," Bronson told the analysts, "Seventeen [new] greenfield fabs are announced to go online in 2001 and early 2002--10 of which will be 300-mm [wafer processing facilities]. In addition to the new greenfield fabs, we believe there are about eight viable empty shells ready for equipment." Financial analysts wanted to know how soon new 300-mm fabs would become a factor in chip capacity. Bronson said Applied was sticking to its assumption that 2002 will be the first "production year" for the larger 300-mm substrates. Expectations of a faster ramp in 300-mm processing have increased since Intel Corp. announced its first 12-inch wafer fab for mass production in Chandler, Ariz. (see Jan. 25 story). "These things happen slowly," said Morgan, referring to the transition from 200-mm to 300-mm wafers. "You get one or two companies that put in a factory out a whole bunch of [worldwide] capacity. The industry is getting to be so big that one or two factories at 300-mm will not change the dynamics of the business," cautioned Applied's chief executive officer. "It is quite a bit further out before it [300-mm] begins to have a significant impact on the industry capacity." But Applied is ready, said Morgan, who referred to the company's 75 products and process technologies for 300-mm fabs. So, if industry growth in chip equipment sales reaches 46% in 2000, what about 2001 or 2002? Morgan won't speculate about market conditions beyond 2000. "We are just focused on this year," he told analysts.