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To: Lazarus_Long who wrote (44096)	7/15/2003 7:32:01 PM
From: Techplayer	Respond to of 57110

true...then there is this: Intel R&D Budget Bump-Up Seen as Sign of Optimism 26 minutes ago Add Technology - Reuters to My Yahoo! By Daniel Sorid NEW YORK (Reuters) - Intel Corp.(Nasdaq:INTC - news), which reported a higher quarterly profit on Tuesday, said it would throw another $200 million into its research and development budget this year, a small sign of confidence in the value of advanced chip-building technologies. Related Quotes KLAC AMAT INTC DJIA NASDAQ ^SPC 51.30 18.67 24.10 9128.97 1753.21 1000.42 +0.95 +0.53 +0.08 -48.18 -1.61 -3.44 delayed 20 mins - disclaimer Quote Data provided by Reuters Taming Digital Media Get a grip on digital music, photos, movies and TV - convert your PC into a powerful entertainment hub The world's largest chip maker -- and largest spender on chip-making equipment said it would spend $4.2 billion on research and development in 2003, up from its previous expectation of $4.0 billion. Intel also stood by its plan to spend $3.5 billion to $3.9 billion in capital expenditures this year. Intel cautioned it did not consider current market conditions a recovery. It said the research-and-development spending rise was aimed primarily at developing the process for building chips a few generations beyond the current leading edge. Chip makers are currently building chips with features as small as 130 nanometers. Spokesman Tom Beermann said this allows Intel to fit about 55 million transistors onto a Pentium 4 chip. Intel said its R&D move was due to a "transfer in resources" to the development of processes that can build chips with features half that size, or 65 nanometers. The smaller dimensions would allow Intel to add more features while reducing the size of the chip, and therefore the cost. "It looks like they're getting more aggressive on getting to 65 nanometers faster," said Mark FitzGerald, chip equipment analyst for Banc of America Securities. Makers of microchip-making equipment, such as leader Applied Materials Inc. (Nasdaq:AMAT - news) and KLA-Tencor Corp. (Nasdaq:KLAC - news), rose in after-hours trading. Analysts said investors were encouraged by Intel's core operations, not the research and development budget, which has little to do with current market conditions. Still, the extra $200 million for R&D was seen as a small but important endorsement for next-generation technologies. Chip makers have slashed their budgets for expanding and upgrading chip plants amid the worst-ever downturn for semiconductor companies. "Intel's doing better; they're feeling much better demand for PCs and handset," said Morgan Stanley analyst Steven Pelayo. "The other side of the equation is they're endorsing spending more at 65 nanometers. It gives me more confidence." Applied Materials rose to $19.15 in after-hours trade from an earlier close of $18.67. KLA-Tencor rose to $52.25 from $51.30 at the close.