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

To: Gottfried who wrote (54101)	10/12/2001 7:44:32 PM
From: Proud_Infidel	Respond to of 70976

Flash recovery seems stalled until 2002 By Robin Lamb and Jeanne Graham EBN (10/12/01 16:23 p.m. EST) Earlier indicators of stability in the flash memory market gave way to uncertainty as the third quarter closed without an expected uptick in flash revenue. “Whatever chance we had to have a rebound in September was nullified by the World Trade Center and Pentagon attacks, along with the subsequent curtailment of business for a week,” said Alan Niebel, an analyst at Web-Feet Research Inc., Monterey, Calif., in a report. Departing from his earlier stance, Niebel predicts this year will be the worst downturn ever for flash and other types of memory. Before the attacks, Niebel expected the flash merchant market to reap a little more than $10 billion in revenue this year, down 10% from last year's $11.3 billion. He recently revised his forecast to show a 29% drop in revenue, to about $8.04 billion for the year. “Demand is down on all memory products in the industry right now,” said Kevin Plouse, vice president of technical marketing at Advanced Micro Devices Inc., Sunnyvale, Calif. “It's not as if one product is doing much worse than another. It's that a lot of the end products-like cellular phones-did not grow as much as forecast and Internet and telecom equipment are down year-over-year.” iSuppli Corp., El Segundo, Calif., predicts overall memory revenue will drop 46.6%, to $27.5 billion in 2001 from $51.5 billion last year. “Six weeks to two months ago, there was some anecdotal evidence suggesting a pickup in [flash] demand,” said Keith Horn, vice president of marketing at Fujitsu Microelectronics Inc., San Jose. “The recent events have cast a lot of uncertainty on the market.” Even with the uncertainty, analysts are looking for a light at the end of the tunnel. Niebel expects fourth-quarter flash revenue to be about $1.64 billion, relatively flat compared with projected figures of $1.65 billion in the third quarter. But the third quarter's 19% sequential decline isn't due to the terrorist attacks of Sept. 11, according to Betsy Van Hees, an analyst at iSuppli. Prior to the attacks, SanDisk Corp., Sunnyvale, and other suppliers were suffering from the decline of flash memory prices and reduced demand for consumer products that required large quantities of flash memory, such as MP3 players. Although Van Hees agrees that the market hit bottom in the third quarter, she plans to revise her outlook for next year. “In 2002, I have the [flash] market growing at about 17%,” she said. “With the World Trade Center [attacks factored in], I'll probably revise that number lower, to about 10% to 13%.” That's only slightly more optimistic than Niebel's projected growth of 8%, to $8.65 billion in 2002, down from his previous prediction of $13 billion for next year. “I have a single-digit growth forecast for 2002 because of the uncertainty with the war and how that will affect the economy,” Niebel said. “Normally, I would say we've hit the bottom of market prices because we're in the quarter with the greatest demand, but we can't say that because of the war.” Both analysts expect the market to grow nearly 30% in 2003.