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

To: Proud_Infidel who wrote (37076)	8/30/2000 9:11:03 AM
From: Proud_Infidel	Respond to of 70976

Applied Materials Sees Continued Growth from Taiwan James Morgan Chairman and CEO, Applied Materials Inc, USA Applied Materials Inc, the world's largest manufacturer of semiconductor equipment, posted a 27% increase in net income to US$2.19 billion in the second fiscal quarter, which ended in April. This was a sharp upturn from the US$1.17 billion in the year-earlier quarter. In June, the company was listed on the Stock Exchange of Hong Kong. James Morgan, chairman and CEO of Applied Materials, talked to NEA about the semiconductor industry and his company's Asia operation. NEA: How does the listing of Applied Materials in Hong Kong fit into your strategies in Asia? Morgan: The listing here is really part of our strategy of building a great company. It helps us serve our investors in this region better by giving them asset opportunities to invest in. They might know about the semiconductor industry because there are so many semiconductor companies in Asia, but they don't necessarily have a good vehicle for investment. NEA:Your last financial result suggests that your company has fully recovered from the serious industry downturn in 1998 and early 99, what lessons have you learned from this? Morgan:I don't think we've learned anything; we already knew what to do. We continued to invest aggressively in new products, supported our customers, and even continued to invest in the Asian region. I think that really paid-off. We have had a long-term view, that is to be able to support the industry over the decade. Our business last year (ended October 1999) was under US$5 billion, and in the past four quarters has been US$7 billion. So clearly business is picking up and we are gaining shares. We spent about US$3 billion over the last five years even during the tough times to get a set of products, and we spend US$1 billion this year working very hard to invest in new technology. NEA: How's the performance of Asian markets in the past year? Morgan: It has been picking up substantially over the past year. Taiwan was the first and strongest. We have seen fast growth in Southeast Asia, especially Malaysia and Singapore although from a smaller base. It looks like China is beginning to pick up. Korea will probably need to invest more this year, and Japan is beginning to invest. Japan hasn't bought much (of the company's equipment) nor has Korea in the last couple of years. They haven't bought much compared with what they used to buy. NEA: How do you see the development of Taiwan's semiconductor industry? Have consolidation and mergers affected your business? Morgan: They are doing a good job and will continue to be successful. Probably, we will increase our market share there. People consolidate to gain a stronger position, and the reason for the sale is that they don't have the latest technology, so they will buy new equipment. NEA: Did the earthquake in Taiwan last September affect your company and your customers? Morgan: Not much. Within 24 hours (after the quake) we assessed the situation of our customers and our own facilities. Our facilities were OK, except a little damage to the warehouse. Within 24 hours we had a plan to add an additional 100 people from around the world to support Taiwan, but we only needed around 30. We put everything back online in about two weeks. NEA: How do you see the development of semiconductor industry in China, and under what conditions will it develop faster? Morgan: The WTO (World Trade Organization) entry will help. I think it will help increase people's willingness to invest a large amount of capital in China. If business transparency improves, decision-making and legal frameworks get better, then people would be willing to make billions of dollars of investments. We have had sales and service capabilities in China since the mid '80s, and we think the market will expand in the next few years. Over the years, we have hired a lot of Chinese and we will be able to support China. by Keith Chan, Hong Kong (August 2000 Issue, Nikkei Electronics Asia)