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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: niceguy767 who wrote (77117)	4/15/2002 8:51:04 AM
From: Dan3	Read Replies (1) \| Respond to of 275872

Looks like AMD locked in wafer prices at the bottom: Check out what UMC was charging per finished wafer at the time AMD locked in prices - even if .13 is 50% higher than the .25 wafer prices listed, AMD will have gotten itself a very, very, good deal: Chiali Chen, Taipei; Jane Wang, DigiTimes.com [Monday 15 April 2002] With the rise in production utilization rate, IC design companies report that United Microelectronics Corporation (UMC) is planning to raise contract-manufacturing prices for the third quarter by an average of 25%, closing the price gap with Taiwan Semiconductor Manufacturing Company (TSMC). IC design companies indicate, however, that the ability of UMC to actually achieve a 25% price increase is still subject to change in the market as well as the actual demand that companies will report after negotiations. UMC’s current notification of a potential price increase could be a simple move to test the waters, IC design companies claim. Overall prices will reportedly increase by 25%, but prices for 0.25-micron processing may increase by more than 30%, the IC design companies said. As such, UMC reminds customers that as orders received before the third quarter will not be subject to the price increase, booking third-quarter production in advance in the second quarter is advisable. According to IC design companies, UMC’s prices tend to fluctuate more than TSMC’s and generally are about 20% lower than TSMC’s prices for the same production process. For example, for 0.25-micron processing, TSMC’s prices are currently set at US$1,450 per wafer, while UMC prices are at US$1,100-1,250. Taiwan’s two pure-play foundries TSMC and UMC’s utilization rates have progressively risen along with the market recovery, at 50% in fourth quarter of 2001, 60% in the first quarter of 2002 and 70% in this quarter and are expected to rise further with the electronic industry’s traditional third-quarter high season. TSMC’s advanced 0.18-micron processing and below have maintained full capacity since the end of last year. IC design companies further indicated that the increase in demand in the consumer electronics market has boosted utilization rates to as high as 80%. UMC’s Fab 8AB, using 0.25-micron processing, has reached 90% utilization, leading Mediatek, Novatek Microelectronics, Realtek Semiconductor and other UMC IC design clients to transfer a portion of production to Fab 8E, IC design companies reported. As yet, TSMC has not notified IC design clients of any increase in contract-manufacturing prices. digitimes.com