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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: robert b furman who wrote (102)	10/27/2001 4:08:57 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 25522

Ericsson posts loss, sees weak 2002 By Reuters October 26, 2001, 1:40 p.m. PT update STOCKHOLM, Sweden--Swedish telecommunications company Ericsson reported a deeper-than-expected, third-quarter pretax loss Thursday and forecast a falling market for its key product, mobile networks, next year. "The slowdown for telecommunications systems accelerated in the third quarter," Ericsson Chief Executive Kurt Hellstrom said in a statement. Ericsson, which has 80 percent of sales from mobile systems, made a $548.7 million (5.8 billion crowns) pretax loss in the third quarter against market consensus of roughly $425.5 million. The company's sales of $5.16 billion fell short of market consensus of $5.6 billion. The company also posted a worse-than-expected July-September per-share loss, down from a profit in the same period last year. Ericsson, the mobile networks producer and handset supplier, also had a more pessimistic outlook for the networks market for 2002 than many of its competitors such as Nokia and Nortel Networks. "For 2002 we expect sales at least in line with the market development of flat to down 10 percent," Ericsson said in a statement released Thursday. The new forecast is much more pessimistic than the flat-to-modest growth of the networks market in 2002 predicted by the company in early September. Despite the pessimism, shares rose 13 cents, or 3 percent, to close at $4.48 Friday. A 10 percent fall? "We now estimate the range to be flat to down 10 percent," the statement said. "However, we plan to achieve an operating margin greater than 5 percent for the full year, even with sales declining as much as 10 percent," it said. This was in line with figures in a Reuters story earlier Thursday that quoted an industry source. Finland's Nokia, the still-profitable producer of mobile phones, forecast last week a tough market for networks until the second half of 2002, and said its systems sales would drop 20 percent in the fourth quarter. Ericsson said its network sales in the fourth quarter would fall 10 percent year on year. "Our assumptions are a market downturn lasting well into next year, significant net subscriber additions with continued increasing usage per subscriber, gradual buildup of GPRS traffic over the next 12 months to 18 months and increased deployment of 3G systems during 2002," the statement said. Ericsson defied market expectations of a loss in the networks business with a 1 percent operating margin on sales of $4.06 million. The market had expected the networks unit to dip into the red for the first time in years. This was also in line with a Reuters report, citing an industry source. It also reported positive cash flow of $113.4million, in line with an earlier Reuters story, calming fears it would have to issue new shares. Positive cash flow is the company's main goal for this year, and management bonuses depend on its success. Appointing a new chairman But the company said in a separate statement that Chairman Lars Ramqvist, often criticized for Ericsson's current misfortunes, would step down at the company's next general shareholders meeting in March 2002. The CEO of appliance maker Electrolux, Michael Treschow, would be the candidate to replace him, Ericsson said. The company said in the quarterly report it managed to slightly cut losses in its mobile phone unit, which on Oct. 1 was merged with the handset division of Japanese consumer electronics company Sony. Ericsson's handset division, which has been losing money since the second quarter of last year showed sales of $785 million against expectations of $756.5 million, and an operating loss shrinking to $398 million from $435 million in the second quarter. The company said it now expected global handset sales this year at around 400 million units, at the lower end of a forecast of 400 million to 440 million units made in July. Ericsson said it expected sales in the fourth quarter to be $5.2 billion excluding the parts of the operation shifted to the mobile phone joint venture with Sony. To return to the black, the company has already announced an efficiency program which entails up to 22,000 job cuts or one fifth of Ericsson's work force. Ericsson said the plan was going ahead of schedule and that savings this year would reach $662 million rather than the earlier-expected $520 million. Ericsson also said its customer financing exposure fell by $94.5 million in the third quarter to $2.07 billion, with Brazil and the United States being the markets where the financing was largest. Story Copyright © 2001 Reuters Limited. All rights reserved.

To: robert b furman who wrote (102)	10/29/2001 8:28:02 AM
From: Proud_Infidel	Read Replies (2) \| Respond to of 25522

World Production of Color LCDs for Mobile Phones Seen Rising 92 Pct. in 2001 October 29, 2001 (TOKYO) -- World production of color liquid-crystal display panels for mobile phones is expected to reach 48.26 million in 2001, up 92 percent over the previous year, according to a survey conducted by Nikkei Market Access. Over the full year, the figures look excellent, but the story is quite different when quarterly trends are considered. In the first quarter of 2001, production of color LCDs for mobile phones rose sixfold year-on-year to 12.87 million panels. But in subsequent quarters, production showed virtually no growth at all. In the fourth quarter of 2001, production is expected to fall one percent year-on-year, down to a similar level as in 2000. In 2002, although there are several unforeseeable factors such as the effect of the September 2001 terrorist attacks in the United States, a gradual rebound is expected in the European market and production is forecast to reach 69.21 million panels, a 43.4 percent increase over the previous year. Development of Offshore Markets is Crucial The driving force behind the rapid growth in 2000 of color LCDs for use in mobile phones was of course the color-display mobile phone boom in Japan. Internet-enabled content services, typified by NTT DoCoMo Inc.'s i-mode service, accelerated the move to color panels. Nearly all the handsets manufactured for the Japanese market in 2001 have color panels. However, with Japan accounting for over 90 percent of the market for color mobile phones, the Japanese market has practically reached saturation point now. At the beginning of 2001, LCD panel makers were anticipating a surge in color-enabled handsets in Europe, the largest market for mobile phones worldwide. In the second half of 2001, the infrastructure would be in place for General Packet Radio Service (GPRS), the standard best suited for high-speed data services in Europe, and this would drive demand for replacement purchasing of mobile handsets. Such was the scenario envisioned by the LCD manufacturers. Contrary to expectations, however, the European market experienced a sharp decline in demand for mobile phones. Moreover, carriers in Europe have gone through a financially debilitating process to obtain 3G licenses, leaving them ill-prepared to aggressively expand their data services. Many observers expect the effects of the September terrorist attacks to further depress business conditions and the downturn in mobile phones to continue. However, it is also true that the LCD industry is "too much influenced by backward-looking thinking these days," as the marketing manager for one LCD panel maker put it. There have been a number of new ideas for developing color LCDs for mobile phones recently. Despite the slowdown in 2001, a great many mobile phone manufacturers in Europe and the United States are working hard to turn the situation around. There is no call for over-optimism, but the color mobile market in Europe could rebound given the opportunity. In terms of the technology, passive matrix, super-twist nemonic color LCDs are proving to be much stronger contenders than expected. Production of active matrix LCDs for mobile phones, including both thin-film transistor (TFT) and thin-film diode (TFD) technology, was predicted to surpass passive-matrix LCD production over the whole of 2001, but passive matrix production stayed ahead through the first three quarters of the year. In the fourth quarter, active-matrix LCDs will exceed passive-matrix LCDs, but active matrix production will still only be 19.43 million panels for the full year, as against 28.83 million panels for passive-matrix LCDs. Note: Figures for 2001 and 2002 are estimates. Data compiled by Nikkei Market Access. Related story: Worldwide TFT-LCD TV Production to Reach 810,000 Units in 2001 (Ken Nakamura, Nikkei Market Access)