Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Varian Semiconductor Equipment Associates -- VSEA -- Ignore unavailable to you. Want to Upgrade?

To: Sidney Street who wrote (797)	8/9/2000 9:11:09 AM
From: Proud_Infidel	Read Replies (5) \| Respond to of 1929

Interview with Richard Aurelio: Varian Semiconductor: Fast growth challenges supply chain 8/2/2000 Varian Semiconductor Equipment Associates (VSEA; Gloucester, MA) has been in business for 28 years. The semiconductor portion of the company was spun out of Varian Associates in April, 1999. Varian pioneered the development of ion implantation for semiconductor manufacturing. The Wall Street Transcript, a Semiconductor Online content partner, interviewed VSEA's Richard Aurelio and Ernest Godshalk in conjunction with the recent Robertson Stephens Semiconductor Conference. Richard Aurelio is president and CEO of VSEA. He served as executive VP for Varian Associates' semiconductor equipment business until it spun out as a separate entity. Mr. Aurelio joined Varian Associates in 1991 from a position as executive VP of ASM Lithography from 1987 to 1991. Mr. Aurelio began his career as an aerospace design engineer following graduation from Rensselaer Polytechnic Institute with a degree in mechanical engineering. He also holds an MBA from the University of Louisville. Ernest L. Godshalk is VP and CFO of VSEA. Since 1998, Mr. Godshalk served as VP of finance for Varian Associates' semiconductor equipment business and helped lead its spin-out as a separate public entity. Prior to joining Varian Associates, he was managing director of an investment company, ELGIN Management Group, a position he held from 1993 to 1996 and again in 1998. Mr. Godshalk graduated from Yale University with a BA and holds an MBA from the Harvard Business School. TWST: What do you see as the most significant trends or developments in your sector of the market in the next few years? Mr. Aurelio: What customers are telling us most often is that they need more flexibility in their tools for two reasons: to produce 200- or 300-mm wafers, and to most effectively schedule these very high throughput tools in their fabs. The bottom line is customers are telling us that they need a single wafer, single platform machine. The Varian ion implant single wafer throughput advantage, VIISta platform, offers considerable flexibility. It is capable of producing the complete matrix of transistor requirements from low sub-keV energies to ultra-high multiple MeV energies. The customer also wants a high tilt, which is required for advanced transitor designs and only available on a single wafer machine. Small batch sizes, down to individual wafers, are a requirement for high-cost 300mm production, further improving and scheduling flexibility without the need for dummy wafers that some of the older spinning disk designs still require. TWST: What does the high tilt do for the wafers? Mr. Aurelio: High tilt extends the current generation of lithography as a result of its ability to reduce the L-effective gate length (thus improving the device speed) for microprocessors and the cost for memory. Mr. Godshalk: While the wafer appears to be flat and two-dimensional, the transistors are actually three-dimensional. They're actually built underneath the surface of the silicon, so in some cases high tilt is very desirable. It enhances the performance of the device to be able to do a new implant under an existing implant. TWST: What is the greatest opportunity for Varian? Is it continuing along the lines of creating the VIISta series of machines? Mr. Aurelio: That's exactly right. As customers move to either 300-mm or continue to drive shrinks along the technology roadmap to either improve their productivity or their device performance, they are gravitating very quickly towards single-wafer machines. We have built over 1,800 of these single wafer machines in its previous generations. Varian Semiconductor's E series has been very successful. We have shipped close to 700 of the current series, and we are still going strong. Finally, as customers move toward shallower junctions, we have a new product. We introduced that advance, VIISTA 10 P2LAD at Semicon West. P2LAD uses the same platform, but instead of a traditional ion beam, it uses a pulsed plasma system for direct implantation with a highly directional and specific plasma field. TWST: What are the opportunities for improvement in the company as of now? Mr. Aurelio: The thing that we've found most challenging over the past year is simply meeting the huge customer demand that we've had. We have been deluged with business and, frankly, we got a little bit behind. We were not able to meet the demand early on. However, we've made a number of improvements to catch up. We expanded our manufacturing capacity to allow us to exceed a run rate of about $1 billion a year. We recently brought in a very experienced VP of Manufacturing from General Electric, and he is off to a fast start. And, we're well on the road to developing e-commerce capabilities that will also help to shorten our lead times. TWST: What are your goals with regard to your market position and growth in the next several years? Mr. Godshalk: We believe we have been growing faster than the industry, and our longer-term goal is to continue to increase our market share. We're also working hard at our gross margin improvement rate, which is continuing to advance. We're hoping to get to 40% by the end of this year. In short, there are three important goals: to increase market share, increase gross margin, and growth exceeding that of the industry. TWST: What do you consider the primary factors affecting your operating margins right now? Mr. Aurelio: The strength of the general economic conditions in the United States, while intensifying our supply chain demands, has made it more difficult to improve cycle times and expand our supply chain. We are now investigating sources outside of the United States to take advantage of perhaps local sourcing, especially since 70% of our product is shipped outside the US. We have recently ramped up our Korean operation, where we have had a factory for 15 years. Between Korea, Taiwan, the US, and Europe, we think that we can make significant improvements in our supply chain and thus continue to improve our margins. Edited by Katherine Derbyshire Managing Editor, Semiconductor Online

To: Sidney Street who wrote (797)	8/14/2000 8:10:39 PM
From: Proud_Infidel	Read Replies (2) \| Respond to of 1929

Cypress' Fab 4 in Minnesota to double capacity by late 2001 Semiconductor Business News (08/14/00, 07:57:05 PM EDT) BLOOMINGTON, Minn. -- Cypress Semiconductor Corp.'s Fab 4C expansion in its chip plant here is ramping into volume production with a goal of reaching full capacity by late 2001, the company said today. When the new module is at full capacity, the facility will nearly double its chip-pricessing volumes to 29,000 eight-inch wafer starts per month, said Chris Seams, vice president of wafer fabrication at Cypress. The frontend line is located adjacent to the Fab 4A and Fab4B modules in the same cleanroom space. Fab 4C is initially being brought up into production with a 0.25-micron process technology but it will shift over to Cypress' new 0.15-micron RAM7 technology next year, Seams said. The RAM7 technology has the capability of producing an 8-megabit SRAM on a die measuring 20 square millimeters using Cypress' patented six-transistor cell (see Aug. 7 story). Cypress plans to use the new Fab 4C module to produce communications ICs for wireless terminal and wide-area network (WAN) applications. RAM7 technology has produced functional silicon and will be used for over 10 new products next year, according to the San Jose-based chip maker. Cypress opted to bring up its Bloomington plant in three increments with Fab4C being the last module in the facility. "The incremental increase of capacity enabled by Fab 4C, combined with additional outsourced foundry capacity, will enable Cypress to scale our manufacturing capabilities to meet the growing needs of our customers, while minimizing the risk of overcapacity," said Rich Freeman, vice president of worldwide manufacturing at Cypress.