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

To: Cary Salsberg who wrote (62235)	3/21/2002 7:58:36 PM
From: Jeffrey D	Read Replies (2) \| Respond to of 70976

By Mark Boslet Of DOW JONES NEWSWIRES SUNNYVALE, Calif. (Dow Jones)--Applied Materials Inc. (AMAT) said it hopes operating profits during the peak of the next upswing should exceed those of the past upswing. The company unveiled its goals at a meeting with Wall Street analysts here Thursday, where it also stressed a new focus on expanding services revenue, especially in Asian markets. Applied Materials Executive Vice President David Wang also said the company sees the market for equipment used to make semiconductors on 300mm silicon wafers rising to $15 billion in 2003. The company had earlier estimated 300mm sales across the industry would be $10 billion this year. Chip plants that use 300mm wafers - 12 inches in diameter - are able to produce more semiconductors per wafer than most plants today, which use 8-inch silicon platters. So far, nine companies operate 300mm plants, including Intel Corp. (INTC). Wang said he expects three more companies will begin pilot lines in the next six months: one in the U.S., Europe and Southeast Asia. Wang went on to say the recovery in the semiconductor manufacturing equipment industry continues. "The spring of our industry is around the corner," he said. A few months ago, capacity utilization at chip foundries was 35%. Today, it is closer to 60% and by the end of the year it should reach 80%. As the industry reaches its next growth peak, Applied hopes its margins and ability to generate cash will exceed its performance in 2000, the peak of the last cycle, said Joseph Bronson, chief financial officer. Back then, the company's gross margin reached 51.7%. Bronson said his goal is 54% to 55%. The company's goal for operating margin is 33% to 35%, up from the last cycle's peak of 31%. Cash generation should be 25% of revenue compared with 20% of revenue. "There's no reason why we shouldn't be able to achieve the goals we have," Bronson said. Applied Materials also said it had authorized a 2-for-1 stock split for shareholders of record on April 1. -By Mark Boslet, Dow Jones Newswires; 650-496-1366 (END) DOW JONES NEWS 03-21-02