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

To: Ian@SI who wrote (45445)	4/16/2001 9:01:42 AM
From: advocatedevil	Read Replies (1) \| Respond to of 70976

Ian, The dinosaur does point out something that is a valid concern IMO: pricing pressure. While DRAM price fluctuations are closely followed by many, it seems as though there's much less discussion and focus on pricing in other areas of the chip sector. Yes, we'll clear out the excess inventories, and yes, slowing demand will change course, and yes, excess capacity will be used up, but in the mean time competitive pricing will certainly have a significant impact on the bottom line. Companies will want to keep those machines running even if margins become minuscule. It will be a time where those that have a good balance sheet will have an opportunity to increase market share as they can afford to undercut the smaller players. As sales begin the road back to previous levels, profits are likely to lag a bit. I expect as earnings come down, chip makers will be recalculating the production cost benefits of new investments in semi equipment. AdvocateDevil

To: Ian@SI who wrote (45445)	4/16/2001 10:15:33 AM
From: advocatedevil	Read Replies (1) \| Respond to of 70976

"Intel will dramatically cut prices on the Pentium 4 this month to stimulate demand for its new chip, as the processor market gets even uglier." news.cnet.com "Intel Falls After Morgan Stanley Chip Call" thestreet.com "Edelstone cut his outlook for the chipmaker to 45 cents per share from 60 cents for 2001 and to 60 cents from 80 cents for 2002. " _________ So, is Intel going to stand firm with their $7.5 billion capex plans when the announce earnings this week? AdvocateDevil