Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: rhering who wrote (8645)	1/29/2004 2:32:33 AM
From: C_Johnson	Read Replies (3) \| Respond to of 25522

Just my opinion: TSM, UMC, Chartered, Silterra, Maybe SMIC: They have, "Virtual Capacity." What happens if your end yields are only 45% (130nm and below) and you improve your yields by 50 percent? Are you still short capacity? How does any company operate at 101% of capacity? Carl

To: rhering who wrote (8645)	1/29/2004 4:44:13 AM
From: robert b furman	Respond to of 25522

Hi Roger, At the very least -this will bring about a margin expansion as supply and demand imbalances result in ASP expnsion. This is very healthy as the increased margins will result in Capex expenditures. As we swing to end user demand creating better than expected ASP's - greed finally becomes the motivator. Lost business is once again a refreshing and new concept. Bob

To: rhering who wrote (8645)	1/29/2004 12:11:01 PM
From: Proud_Infidel	Respond to of 25522

Foundry Watch: No seasonal slowdown at TSMC By Mark LaPedus Silicon Strategies 01/28/2004, 8:35 PM ET SAN FRANCISCO--For the most part, chip makers are seeing a slight seasonal slowdown in the first quarter of 2004. Or are they? Not all chip makers are feeling the seasonal blues, especially silicon foundry giant Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC), which is seeing better-than-expected wafer starts in January. At the same time, TSMC is expected to raise its capital spending forecast to $1.85 billion in 2004, up from $1.25 billion in 2003. "Our revised checks on TSMC's wafer start activity appear even stronger than expected in January," said Bill Ong, an analyst with American Technology Research Inc. in San Francisco, in a report. "We believe wafer activity could be up 3-4 percent M/M vs. earlier checks of down 2 percent from prior month's record levels. Pricing environment remains strong on both the foundry wafer and wafer substrate level." The silicon foundry giant continues to pick up steam heading into 2004. "It appears that the activity level has not let up and January could be another record month in wafer start activity," Ong said. "The demand appears broad based across all product applications, with indication that February will be stronger than seasonal activity even after the Chinese New Year holiday." Earlier this year, TSMC said its net sales in December 2003 totaled $562 million, an increase of 2.5 percent from November 2003 and an increase of 67.2 percent on December 2002. As a result of the strong December the company's fourth quarter 2003 sales were a record as were the full-year sales of $5.98 billion, up 25.4 percent over 2002, the company said. TSMC's fourth quarter 2003 sales grew 5.3 percent sequentially to $1,712 million and on a year-over-year basis fourth quarter 2003 sales increased 40.4 percent, according to the silicon foundry giant, based in Hsinchu. And there's more good news, especially for the chip-equipment community. "We expect TSMC to report 2004 Capex plans in the $1.85 billion range, up about 50 percent Y/Y, when the company releases its earnings on Jan. 29th," he said. Capital spending last year is expected to be about $1.25 billion, while peak expenditure levels in 2000 were at $3.75 billion. "The chip demand environment remains quite strong with greater than 90 percent fab utilization rates and foundry wafer price increases across all technology nodes," he added.

To: rhering who wrote (8645)	1/29/2004 2:12:42 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 25522

Is this the reason for the selloff? UPDATE - TSMC profit jumps six fold, sees peak coming Thursday January 29, 6:06 am ET By Michael Kramer (Recasts, adds chairman's comments, details) TAIPEI, Jan 29 (Reuters) - TSMC, the world's largest contract microchip maker, posted quarterly earnings on Thursday that vaulted six fold back to boom-time levels, saying the highly cyclical chip industry would further surge to a peak in 2004. The strong results for the chip-industry bellwether met market expectations and underscored the sector's recovery from a lengthy slump as consumers snap up gadgets such as camera phones and flat-panel televisions. "This is still early summer in the cycle, so we are still preparing for the (peak)," Taiwan Semiconductor Manufacturing Co (TSMC) (Taiwan:2330.TW - News; NYSE:TSM - News) Chairman Morris Chang told an investor conference. Chang said TSMC estimated global semiconductor revenues would rise 26 percent in 2004, higher than the 20 percent consensus growth forecast by analysts. "I think what's really quite exciting is that Morris said that the industry would grow 26 percent this year... we would expect TSMC to exceed that," said Deutsche Securities semiconductor analyst Johnny Chen. TSMC said net profit was T$16 billion (US$479 million) in October-December, compared with T$2.55 billion in the fourth quarter of 2002, and analysts' expectations of T$15.99 billion. The earnings were the best in three years and come off a dismal year-earlier period when inventories were bulging from a false dawn in mid-2002 following a record revenue plunge for the chip industry in 2001. TSMC said that while all sectors were showing growth, communications products were expected to be the main driver this year -- from processors for picture-snapping cell phones to chips used in telephone and Internet networks. Mobile phone chip makers Texas Instruments Inc (NYSE:TXN - News), Motorola Inc (NYSE:MOT - News) and Qualcomm Inc (NasdaqNM:QCOM - News) -- all customers of TSMC -- or competitor UMC (Taiwan:2303.TW - News; NYSE:UMC - News), have uniformly given upbeat forecasts for the current quarter. CORPORATE DEMAND EYED In addition, shares in telecom equipment firms jumped early this month after Nortel Networks Corp (Toronto:NT.TO - News) struck a deal with Verizon Communications (NYSE:VZ - News), raising hopes that big phone companies are willing to spend money on technology again. TSMC, which is nearly one-fifth owned by the Netherlands' Philips Electronics NV (Amsterdam:PHG.AS - News) announced its quarterly results after close of trade in Taipei on Thursday. However, investors had priced in the solid earnings as the issue fell 1.48 percent to T$66.5 on Thursday, while the main TAIEX (Taiwan:^TWII - News) share index declined 1.15 percent. TSMC's shares, along with those of United Microelectronics Corp (UMC), have advanced 70 percent since an April 2003 low when the region was hit by the Severe Acute Respiratory Syndrome (SARS) outbreak. The Philadelphia Stock Exchange semiconductor index (Philadelphia:^SOXX - News) rose 72 percent over the same period. TSMC's Chang expected shipments in the first quarter to be one to five percent higher than the last three months of 2003, but would be offset by average selling prices (ASP) that would fall as much as 5.5 percent. Chang said gross profit margin would be unchanged in the first quarter from the fourth, and capacity utilisation would be around 100 percent, or higher. Capital expenditure was set at US$2 billion for 2004, up from US$1.2 billion last year and in line with analyst expectations. "The company and the industry are all in an uptrend, which is in line with expectations," said Grace Yao, a fund manager at JF Asset Management, which has about US$3 billion under management. "Some said that the gross margin could be hurt as ASP could fall below expectations. But the number today shows the gross margin is still 39 percent and that is pretty good."