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

To: Proud_Infidel who wrote (37454)	9/26/2000 9:40:10 AM
From: Proud_Infidel	Read Replies (2) \| Respond to of 70976

Top Taiwan chip, PC makers see strong sales TAIPEI, Sept 25 (Reuters) - Taiwan's top chip and computer companies sought on Monday to reassure increasingly edgy investors with heady growth forecasts and plans to diversify beyond the slowing personal computer market. While a few companies admitted to weaker third quarter sales because of worse-than-expected ``back to school'' sales in the United States, most painted a picture of still robust growth in emerging markets and for chips used in mobile phones, personal digital assistants and other gadgets. Taiwan's Ministry of Finance called a news conference after most local electronics shares plunged their seven percent daily trading limit on Friday following a warning on third quarter sales by world number one chipmaker Intel Corp Local tech shares made a modest rebound on Monday, with the TAIEX share index adding 0.99 percent but the electronics subindex gained only 0.16 percent. Though some analysts say the Intel woes are specific to the company itself and not the entire tech sector, a slowdown in sales of its market-dominating microprocessors could imply that PC sales are also easing. Taiwan is Asia's third largest chipmaker behind Japan and Korea, but made 49 percent of the world's notebook computers and accounted for 64 percent of world motherboard output last year. Taiwan's top PC maker, Acer Inc, which has been suffering from slower sales nearly all year, blamed the slowdown on a client cancelling T$20 billion (US$645.2 million) in orders. But the company said later it expected flagging sales would show a clear improvement from the fourth quarter. ``We have a lot of capacity. We are even thinking about expanding next year,'' Acer vice president Philip Peng said. CHIPMAKERS SEEK GREENER PASTURES Chipmakers distanced themselves from Intel's woes and the PC sector. Taiwan Semiconductor Manufacturing Co, the world's largest custom chipmaker, or foundry, pointed out that PC-related chips made up only a minority of its output. ``From our side, we feel that Intel's impact is quite limited, and the main reason is because our communications and consumer products account for about 60 percent of output,'' said Tien Chi-hao, a spokesman for TSMC. ``The PC side accounts for only 40 percent and there has been no cancellation of Intel orders,'' he said. Acer shares ended the day up T$0.70 at T$34.60, while TSMC shares ended unchanged at T$106.50. Taiwan's other chipmakers also said they were diversifying into faster-growing areas because of the PC growth slowdown. Mosel Vitelic, which makes dynamic random access memory (DRAM) chips, said while global desktop computer shipments surged 22 percent last year, some analysts expected growth to slow to 16 percent in 2000 and 7-8 percent in 2001. Mosel vice president Thomas Chang said the company could post a small sales downturn in the next few months but said it was on track to meet its 2000 profit target of T$11 billion on sales of T$35.6 billion. ``A lot of people might think this kind of change might have a very, very large impact on the DRAM industry,'' Chang said. ``In terms of component companies like us, especially in DRAM, dependence on PCs will fall to less than 50 percent in the next one or two years,'' he said. Spokesmen for Mosel and fellow DRAM maker Winbond Electronics Corp said they expected recent DRAM price weakness to be short-term. ``Right now we are at full capacity and actually we are looking for a contract manufacturer,'' said Winbond spokesman Hander Chang. ``Our stockpiles are also at a reasonable level and we haven't seen any increases.'' Mosel shares ended down T$2.80 at T$38.60 with Winbond off T$4 at T$54.50. ASIAN CHIPMAKERS UPBEAT Other Asian chipmakers also announced upbeat news. The world's largest DRAM maker, Samsung Electronics, said on Monday it would invest 12 trillion won ($10.65 billion) in facilities in 2001 and 2002, citing expected strong growth in sales of memory products. Japan's Mitsubishi Electric lifted its group net profit forecast for the year to March 2001 by 60 percent due to strong sales of chips and mobile phones, following in the footsteps of rivals NEC Corp and Toshiba Corp. mercurycenter.com