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Technology Stocks : ADI: The SHARCs are circling! -- Ignore unavailable to you. Want to Upgrade?

To: pat mudge who wrote (1970)	8/16/2000 11:04:58 AM
From: Scrapps	Respond to of 2882

Wednesday August 16 9:05 AM ET Analog Sees Strong Orders for New Othello Chip By Tim McLaughlin BOSTON (Reuters) - The chief executive of Analog Devices Inc. (NYSE:ADI - news) told analysts on Tuesday evening he expects the company to ship its new energy-saving ``Othello'' computer chip to as many as five major customers next year. ``The acceptance of (Othello) has been very, very good,'' said Jerald Fishman, chief executive of the Norwood, Mass.-based chip maker. ``We expect that it will be significant revenue for us even at out current size next year.'' Othello shipments to one unnamed customer, for example, could produce annual revenue of $75 million by the middle of 2001, Fishman said. He also said three to four other customers were expected to place orders for Othello. Fueled by new products and sales to the communications markets, Fishman estimated, Analog's overall revenue would grow 70 percent this year to about $2.5 billion, and as much as 45 percent in 2001 to more than $3.6 billion. The company on Tuesday reported a jump in its fiscal third-quarter earnings to $164.5 million, or 43 cents a share, from $56.4 million, or 15 cents a share, earned in the year-earlier quarter. The Othello chip aims to provide up to 50 percent savings in the cost and size of the next generation of cellular telephones and Internet devices. The company said the chip allows for 1,000 hours, or 1.5 months, of standby time for cellular phones. Perhaps more important, the chip accelerates the rate data can be transmitted over cellular phones and other devices, allowing for Web browsing, e-mail games and real-time video. With Analog growing faster than its competitors through the introduction of home-grown technology, Fishman questioned the strategy of chief rival Texas Instruments Inc. (NYSE:TXN - news), saying that buying new technology through acquisitions won't be effective in the semiconductor industry. Fishman acknowledged the success of Cisco Systems Inc. (NasdaqNM:CSCO - news) in buying companies to fill its need for new technologies, but noted, ``Acquiring technology in some of the businesses that we're in, and that Texas Instruments is in, is another kettle of fish.'' ``That technology is heavily dependent on certain people and it's very, very difficult to mount a major assault in any period of time by acquiring technology,'' Fishman said. ``That is a very difficult strategy. ``It's a strategy over time that's going to prove not to be very effective. Getting into market places late and trying to acquire your way into parity and technology in this business is a very, very troubling strategy, in my opinion.'' More than $175 million of Analog's $700.7 million in third-quarter revenue came from products introduced in the past 18 months, Fishman told Wall Street analysts late Tuesday. Meanwhile, Dallas-based Texas Instruments, the No. 1 maker of chips for mobile phones, seeks to accelerate growth through acquisitions. During the second quarter ended June 30, Texas Instruments announced three acquisitions designed to expand its leadership in making analog and digital signal processing computer chips found in mobile phones and consumer electronic products. Analog is growing at a faster rate than its chief rival, but Texas Instruments still dwarfs the Massachusetts upstart, reporting about four times greater revenue during its most recently ended quarter. dailynews.yahoo.com