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

To: Tony Viola who wrote (42320)	2/17/2001 3:44:46 PM
From: advocatedevil	Respond to of 70976

Tony, UMC (#2 foundry in the world) is rapidly changing capex spending plans. They cut $1.1 billion last week on top of $300 million in January. That's down almost half from last year. TMSC (#1 foundry in the world) cut $1 billion out of their plans last week. That's down more than a quarter from last year. Also worth noting for these two leaders is that their stated chip production this year is expected to increase (33% for TMSC) and (27% for UMC) even after these spending cuts. While 300mm will now comprise an increased percentage of what remains for these folks to spend money on, the bottom line is that overall spending estimates are dropping fast. These are the foundry big boys. They have the resources to react to the slowdown in this way. However, if things get worse, even these major players may have to reevaluate their new technology implementation plans. All players are faced with the prospects of slowing demand and growing capacity, but it's the next level of players who might have real trouble reducing their outlays without sacrificing new technologies. AdvocateDevil

To: Tony Viola who wrote (42320)	2/17/2001 4:29:20 PM
From: advocatedevil	Read Replies (1) \| Respond to of 70976

RE: "Intel has reiterated their 7.5 billion capex plan for 2001 a couple of times now" Yeah, I wasn't expecting that level of spending either. On top of that they stated that they were planning for PC growth in the second half (and Intel is normally pretty conservative IMO). I wonder if they'll maintain their plans if it becomes clear that a second half recovery will be delayed. If they were to reduce their spending outlook after increasing it so recently, I think we'd see the semi-equip cos get trashed. I believe Intel's agressive spending and generally positive outlook is a major factor keeping prices from moving lower. AdvocateDevil