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Technology Stocks : RF Micro Devices (RFMD) -- Ignore unavailable to you. Want to Upgrade?

To: Jack Hartmann who wrote (4248)	1/23/2003 10:07:49 AM
From: im a survivor	Respond to of 4849

$5's I'll add more in the $5 area...and will load the boat should she see $2

To: Jack Hartmann who wrote (4248)	1/23/2003 5:11:26 PM
From: Jack Hartmann	Respond to of 4849

The Short-Lived Wireless Party By Cody Willard Special to RealMoney.com 01/23/2003 03:06 PM EST URL: thestreet.com Just when it seemed safe to go back into the water, just when tech seemed to be finally showing some sign of sustainable fundamental improvement -- well, you may have been bitten. Last night, almost everything we heard was good news. Texas Instruments (TXN:NYSE - news - commentary) put in a very solid quarter and had good things to say, especially about its wireless component business. Skyworks (SWKS:Nasdaq - news - commentary) had a strong report and commented favorably about its wireless component business. On Tuesday, RF Micro Devices (RFMD:Nasdaq - news - commentary) also gave some pretty good revenue guidance, though down sequentially from the recently reported quarter. It even used the words "improved visibility." Qualcomm (QCOM:Nasdaq - news - commentary) also noted just how great its wireless chip business is, boosting forward estimates and expecting business to continue booming. Silicon Labs (SLAB:Nasdaq - news - commentary) was really the only wireless component company that wasn't able to talk much of a big game about that segment of its business, mainly because it continues to get its clock cleaned by Skyworks. So wireless component suppliers are rocking and rolling, right? None of this is really much of a surprise, as I've been writing and we've been hearing that component suppliers have had good sales for the past few months. The outstanding question still centers on inventory: Is there a glut or not? The Morning After We didn't have to wait long to begin finding out. To address that question, we always need to look to the end sellers of the product. If the product is selling through to the end user, the supply chain will remain clean. This morning, the market got the double-whammy from Nokia (NOK:NYSE ADR - news - commentary) and Cingular, a joint venture of SBC (SBC:NYSE - news - commentary) and BellSouth (BLS:NYSE - news - commentary) . Both Nokia and Cingular are much better tells than component suppliers because they're much closer to the end user. Nokia confirmed what Motorola (MOT:NYSE - news - commentary) told us Tuesday -- namely, that it won't sell as many phones as the Street had hoped. Cingular reported that it actually lost 160,000 subscribers, rather than adding at least six figures, as the Street had hoped. Analysts have begun seeing wireless as saturated as I do, with Lehman taking its gross industry subscriber estimates lower Thursday, to 10 million from 16 million previously. As far as I can tell, wireless -- in the U.S., especially -- is mostly a zero-sum game now. Verizon Wireless and Nextel (NXTL:Nasdaq - news - commentary) are stealing market share from everybody else, and penetration is topping out in the mid-50% range. It's no longer a growth industry, and with secular growth now gone, it becomes a more competitive, less profitable battle for market share. Component suppliers can only stuff so much inventory into the supply chain before the lack of end demand stuffs it back up to the top. It's just a matter of time before these companies have to face that reality, and their stocks will subsequently head much lower. ********** I wonder where the 160K Cingular subs went? VZ? Jack