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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: FJB who wrote (2367)	3/22/2002 4:44:16 PM
From: Return to Sender	Respond to of 95530

IC tester segment sees hope in above-parity book-to-bill siliconstrategies.com By Mark LaPedus Semiconductor Business News (03/22/02 09:34 a.m. EST) SAN JOSE -- Suppliers of automatic test equipment (ATE) are beginning to see some positive signs after a horrific year in 2001, but many vendors believe the real growth will not occur until 2003. Without a question, the ATE market suffered its worst downturn in history last year. Worldwide ATE sales fell 64.2% to $2.4 billion last year from $6.7 billion in 2000, according to estimates from VLSI Research Inc., a market research firm in San Jose. Industry figures, collected by the SEMI trade group here, also show 2001 ATE revenues plunging like a rock--down 63% to $3.4 billion from $9.2 billion in 2000. The logic tester segment took it hard on the chin, falling 91% in terms of worldwide sales in 2001 from the previous year, according to the Semiconductor Equipment and Materials International group. The memory ATE business dropped by 90% in 2001 compared to 2000, while the mixed-signal tester market fell 77%, according to SEMI. The worst is over for ATE suppliers, but 2002 will be "flat or a little bit up," predicted analyst Risto Puhakka at VLSI Research. The market for system-on-a-chip (SoC) ATE "is very strong," while memory testers remains soft, Puhakka added. Others point to new evidence of better times ahead. "Bookings are improving in the ATE business," said Craig Klootwyk, an analyst with SEMI in San Jose. One indicator of the improvement is SEMI's book-to-bill ratio, according to the SEMI analyst. Orders and billings for all types of chip production systems continued to climb out of the basement in February with North American-based suppliers posting a 0.87 book-to-bill ratio last month, SEMI said this week (see March 19 story). That reading was up from 0.81 in January with both orders and shipments growing sequentially. In the "backend" chip packaging and testing equipment segment, the book-to-bill ratio jumped to a healthy 1.1 in February, according to Klootwyk. The 1.1 book-to-bill means $101 dollars of new orders were being received by suppliers for $100 worth of products billed--in other words growth. In comparison, the book-to-bill ratio for backend equipment was 0.70 in February last year, according to SEMI. The low point for backend tool suppliers was last year June when the book-to-bill skidded to a dreadful 0.35 reading, based on SEMI's data. Many analysts believe latest book-to-bill figure in backend chip equipment marks the start of a surge in growth for IC-assembly tools, especially for fine-pitch wire bonders and other advanced packaging equipment, according to analysts. But still, ATE vendors are just now seeing the light at the end of the recession tunnel, said analyst Greg Konezny of U.S. Bancorp Piper Jaffray in Minneapolis, Minn. "The second half of 2002 should show year-over-year growth [for ATE]," he said. "2003 should show stronger growth." Vendors generally agreed. "We're seeing some improvement," said Jeff Schneider, strategic marketing manager for Teradyne Inc. of Boston. "We see a modest recovery in the second half of this year," he told SBN. There is still uncertainty in the market right now, causing Teradyne to remain "causiously optimistic for 2002," according to Schneider. Others are more pessimistic about the market in 2002. For example, Credence Systems Corp. doesn't "subscribe to the strong second half recovery theory," said Graham Siddall, chairman and chief executive of the Fremont, Calif.-based ATE vendor, in a recent conference call with analysts. "We believe that the recovery in this calendar year will be relatively mild and it will strengthen going into 2003," Siddall said. "In our discussions with our customers, they really believe it's going to be mid-2003 before the test houses are at a revenue level that approaches the peak in 2000," he said. Thank you for posting the link. I thought I would put the entire article here since it took a long time to load. RtS