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To: Demosthenes who wrote (1056)	8/4/2000 6:50:37 PM
From: Maverick	Respond to of 1184

KLIC CEO interview:No slowdown in Semi,SE QUESTION: Do you think there be a consolidation of test and assembly equipment suppliers? KULICKE: There has been no movement yet between the test and assembly segments of suppliers. There is some movement in the test segment to bridge traditional tester problems with socket and [device] handling problems. Teradyne, in particular, has done some work there. But I think it is reasonable to forecast a convergence of suppliers [in automatic test equipment and assembly tools]. We are certainly working on packaging technologies that strain testability-not so much testability inside the tester but at the socket or probe-card area. We have to start to take into account that class of problems. And this means it would be reasonable to forecast some convergence [of suppliers] down the road. QUESTION: Will today's strong business and growth conditions continue for the semiconductor industry? KULICKE: First, this [cycle] has already lasted longer than most upturns. So, we are essentially in uncharted territory. But this is sort of a "John Joseph question," who has said the party is about over [Salomon Smith Barney's chip analyst who in early July made a controversial industry forecast and downgraded chip stocks]. We don't see it that way. We are probably about as cynical as anyone in this business in that we think there will be another downturn. The nature of that downturn will most likely be that our customers will invest in excess capacity, and in an effort to keep that capacity busy, they will cut their [chip] prices. Their profit margins will go to hell and they will cut back in capital investments. That kind of fundamental semiconductor cycle will repeat itself. The issue is when. How quickly can our customers inflict this on the industry? The good news, in our opinion, is that it will not happen as soon as some people think. For a number of reasons, wafer fab capacity is not coming on stream quickly and it will not come on stream as quickly as some of the optimists believe. One very central reason for that is simply that not enough stepper lens sets were started 18 months ago. The cycle time to build a stepper, including building the lenses is in the neighborhood of two years... That puts a natural throttle on the business. Secondly, a significant amount of incremental capacity is coming in as greenfield 300-mm wafer fabs, and they are going to be a bear to bring up. That also mitigates it [the rapid expansion of capacity] a bit. Thirdly, a lot of incremental capacity has come through [device] shrinks in the last two or three years. A lot of those fabs are just shrunk out. They have reached the point to where they just have to start over again. You must replace so much of the equipment that you will have virtually rebuilt an entire wafer fab in the old building. We feel quite comfortable in saying that 2001 will be another significant up year--perhaps not as strong as 2000 was--but it will be a good year. And now we are worrying about 2002, but even there the wafer fab guys probably cannot install that equipment as quickly. That's our answer to John Joseph [He then gives out a long, loud raspberry or Bronx cheer.]. For more, please read semibiznews.com

To: Demosthenes who wrote (1056)	8/10/2000 9:18:56 PM
From: Maverick	Respond to of 1184

ML:AMAT mgmt bullish on semi cycle Excerpts fr ML research 8/10/00 Management upbeat – bullish on the cycle! The management was upbeat during the conference call. The company continues to forecast that the semiconductor capital equipment is alive and well. By its estimates, there are 29 opportunities in 2000 (13 new fabs and 16 major expansions) and 31 opportunities in 2001 (16 new fabs 7 of which are 300mm and 15 expansions). Many of these fabs are mega-fabs, running 60,000 wafers per month, 50% more than a typically fab in the last cycle. The company sees DRAM and 300mm being the key drivers for the next up leg of the cycle. We continue to receive data points that 300mm is accelerating. The company booked its 300mm tools in the quarter and expects to start recognizing revenue in the first two fiscal quarters of 2001. The company now sees at seven 300mm fabs in 2001, this number has continued to trend up over the last several quarters. Bookings were 50% in logic, 25% in foundry, and 15% in DRAM. DRAM is still trending at historic lows as a percentage of both orders and revenue. The company continues to expect a shortage of DRAM to lead to accelerating DRAM spending starting later this year and next. Copper and low-k’s material rollouts continue as expected. Japan Accelerating – Taiwan resting Key regional highlights included: Taiwan was in-line with expectations and is currently flattening at a high rate of growth. Applied Materials predicated that Taiwan would be resting at this high level for the next 1-2 quarters. Japan orders almost doubled sequentially, as Japan is starting to spend aggressively. Japan is focusing most of its attention on consumer electronics and emerging broadband technologies. Europe is firmly spending continue to expanding its communications focus. Infineon, STMicroelectronics, and Philips were all highlights as companies that are dramatically adding capacity.