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

To: Proud_Infidel who wrote (790)	3/12/2002 3:59:00 PM
From: Proud_Infidel	Respond to of 25522

PC market holding out for recovery By John G. Spooner Staff Writer, CNET News.com March 12, 2002, 12:00 PM PT Analysts say manufacturers in the PC market continue to hold their breath, hoping for a recovery in the second half of the year. During a conference call summarizing February unit shipment results from a number of Taiwanese motherboard and notebook PC manufacturers, Merrill Lynch analysts said the Taiwan market is basically back on track with seasonal trends for the first quarter and the first half of the year. The numbers are important because the overwhelming percentage of products produced on the island get shipped to North America and Europe under brand names such as Hewlett-Packard and Dell Computer. If the Taiwanese manufacturers, such as computer maker Quanta or motherboard maker AsusTech, are having a good month or a good quarter, it's an indication that the same holds true for the more well-known PC makers. But the picture is still somewhat bleak in Taiwan. Merrill Lynch analysts Steve Fortuna and Tony Tseng described manufacturers there, who normally have a backlog of orders, as living order to order without great demand for PCs. Manufacturers have been filling orders for notebook PCs in as few as five days, he said. February wasn't a particularly good month for Taiwan. Motherboard unit sales fell 16 percent from January. Merrill had forecasted a 14 percent decline. Notebook unit sales were down 6 percent, which bested Merrill's forecast of a 12 percent drop but was worse than the historic trend of a 9 percent rise in unit sales. Total unit shipments for the month fell 15 percent from January, compared with Merrill's forecast of a 13 percent decline. The historic trend for February is a 4 percent increase in total unit shipments. Merrill predicts March will see motherboard unit shipments rise by 17 percent sequentially, compared with a historic increase of 25 percent to 27 percent. Notebook unit shipments, the firm predicts, will increase by 20 percent, compared with a historical 40 percent increase. Total unit shipments, Merrill predicted, will increase by 18 percent sequentially for the month, falling short of the historical 25 percent to 28 percent jump. While February and March look weak, an 11 percent increase in January unit shipments should prop up quarterly results. Merrill predicts total first-quarter unit shipments in Taiwan will come close to meeting historic trends. "We are now thinking that...the first quarter will be down about 5 percent in aggregate in terms of units," Fortuna said. That figure is "slightly off normal seasonality" for the first quarter, in which units historically drop by 3 percent sequentially from the fourth quarter of the preceding year. Looking ahead to the second quarter, Merrill expects a 10 percent sequential decline in motherboard unit shipments and a 5 percent to 10 percent sequential increase in notebook unit shipments. "That would suggest that numbers out of Taiwan would be down about 5 percent" for the second quarter, Fortuna said. "There really aren't a lot of demand drivers in the first half." However, Taiwanese manufacturers, like many PC makers, are expecting a strong performance in the second half of the year. "They believe we're going to see some recovery in the U.S. economy in the second half, and that will drive PC demand," Fortuna said.