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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Dale Knipschield who wrote (8644)	1/29/2004 1:31:54 AM
From: rhering	Read Replies (4) \| Respond to of 25522

Dale, I agree the market just wanted to go down today. Tommorrow might be a better day. Looks like good news tonight from TSMC. Record shipments, beat earnings estimates and looks like they are actually looking for a slight Q1 shipments increase rather than the normal seasonal dip. Most importantly from a semi-equipment perspective Q4 operated at 101% capacity and they are predicting a 100%+ capacity quarter for Q1 as well. Looks like they are loosing orders due to capacity issues... Regards, Roger

To: Dale Knipschield who wrote (8644)	1/29/2004 7:50:50 PM
From: Proud_Infidel	Respond to of 25522

Analyst's Couch: surplus chip inventory is going, going...gone! Pipeline works off excess semiconductor stockpiles to achieve equilibrium in 2003 By Rosemary Farrell Silicon Strategies 01/29/2004, 7:00 PM ET Rosemary Farrell is a senior market analyst for iSuppli Corp., a market research firm in El Segundo, Calif. Farrell can be reached at: rfarrell@isuppli.com What a difference a year makes. The electronics supply chain began 2003 with $1.1 billion in excess supply, but due to the market recovery it ended the year with a slight undersupply, according to the latest reading of iSuppli Corp.'s Semiconductor Inventory Tracker. Semiconductor inventory in the electronics pipeline was undersupplied by $383 million in the fourth quarter, based on iSuppli's preliminary estimate, putting the supply chain in a state of rough inventory equilibrium. The figure presents iSuppli's estimate of excess semiconductor inventories in the electronics supply chain. The decline in semiconductor inventory levels parallels the recovery of the industry in 2003. More than 90 percent of the chip surplus at the start of 2003 resided with the chip manufacturers, which collectively held one week of oversupply. Saddled with excess parts, the chip makers anxiously waited for end-demand indicators to rise and signal to gun-shy customers it was time to buy again. Meanwhile, inventories remained lean at the upstream players, i.e. the OEMs, contract manufacturers and distributors. However, at the close of 2003, chip manufacturers experienced an about-face and their Days of Inventory (DOI) fell to just 2.4, down from 8.5 at the end of 2002. After shouldering the burden of excess semiconductors for two years, chip suppliers finally found relief in the form of aggressive orders placed in the second half of 2003. This momentum cleared up the lingering supply at chip companies and depleted the safety stocks at their customers, creating an extremely lean inventory situation across the entire supply chain. At the end of 2003, inventories at the back end of the supply chain were particularly slim. Electronic Manufacturing Services (EMS) providers were maintaining their lowest supply levels in a year. Inventory levels at distributors were at their lowest points in the past three years. Positive sell-through at the end of 2003 translated to low supply among the OEMs. Inventories at computer, wireless and automotive OEMs were at their lowest levels in more than three years. With the exception of PC-oriented chip companies, all of the semiconductor sub-segments tracked by iSuppli"i.e. Programmable Logic Devices (PLDs), analog/power and communication chips"are operating with the least inventory on hand in more than three years. As the first quarter draws to a close, the current equilibrium in the supply chain will shift somewhat, iSuppli predicts. Healthy demand already has sparked stretches in lead-times. As capacity tightens, chip customers may begin to place double orders to ensure availability of needed parts, forcing the front-end of the supply chain to add inventory beyond safety stock levels.