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 : Semi-Equips - Buy when BLOOD is running in the streets! -- Ignore unavailable to you. Want to Upgrade?

To: Charles R who wrote (8901)	10/22/2000 6:50:34 PM
From: Jacob Snyder	Respond to of 10921

re: "Is this for equipment or chips?": Equipment. But I don't think we are really talking about different things. The semi cycle is intimately connected to the semi-equip cycle. In fact, you could say that the semi-equip cycle is just an "echo" of the semi cycle, offset by about 6 months. When you start seeing rising chip inventories, ASPs falling at a rate greater than the historical average, falling margins at chip companies, overstuffed inventory channels, profit warnings from INTC/MU/TXN (or is it Qualcomm and Nokia now?), then it is a 100% certainty that you will soon be seeing fab pushouts, cancelled orders for semi-equip, etc. My (non-expert) impression was that it takes, currently, about 24 months from breaking ground on a fab, till the equipment is being used at full capacity. And, as I understand it, the equipment gets ordered (=bookings) before "ground-breaking", so I add about 6 months. That gives a time, from bookings to full use, of about 30 months. My impression is that fabs are going to be bigger, more complex, and have several new proceses which the semi companies are going to have to deal with. In addition to the transition to 300mm, they are also (simultaneously), dealing with process shrinks, and the transition to copper. Cary, in a recent post, said 3 years. In previous transitions, a lot of the "old" equipment (which the semi companies are already familiar with) could be reused. In the upcoming transitions, every piece of equipment must be replaced. That was one of the reasons why this cycle was supposed to be longer and more profitable than previous cycles. Other people on this thread would be able to answer these questions better than I can.