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

To: Proud_Infidel who wrote (8868)	2/11/2004 7:13:43 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 25522

Next cycle more 'dangerous,' CEO predicts By Brian Fuller, EE Times Silicon Strategies 02/11/2004, 5:05 PM ET MONTEREY, Calif. -- Fab capacity is tightening across all geometries now, but the next electronics cycle will be "more dangerous" than previous cycles because of the effects of "emotional damage" wreaked on the industry in the past recession, Altera Corp. said Wednesday (Feb. 11). John Daane, in an interview with EE Times, said, "Companies don't want to take a risk and add inventory. It's compounded with the fact that many OEMs have moved their manufacturing out to contract manufacturers. And contract manufacturers aren't willing to take the risk anymore." Daane's comments at the Globalpress Summit 2004 here came a day after UMC CEO Jackson Hu told journalists that his company's foundry capacity will be fully utilized this quarter. "What's going to happen is one day everyone's going to wake up and realize lead times have extended on everybody's products and there's nothing to be had, and they're going to hit the wall after running at 90 miles per hour," Daane said. "You're going to see a sharper increase in your bookings as people scramble to get anything they can to fulfill their orders. So I think this cycle is actually more dangerous because of the emotional damage that's been done." Daane said he's seeing tighter capacity across all geometries, and Altera, both internally and with its distributors, has increased its inventory position in the past quarter with another increased set for this quarter. "The danger is very high that you're going to see a component shortage and some OEMs have trouble shipping products," he added. Altera is not shopping for additional capacity at the moment, he said.

To: Proud_Infidel who wrote (8868)	2/12/2004 3:16:29 PM
From: Bookdon	Respond to of 25522

It will be interesting to hear what AMAT has to say about "non-booked" orders. Since AMAT doesn't "count" orders that are more than 12 months from delivery, in a period of rapidly growing orders that can have a damping effect. I would guess that they are quickly reaching the 12 month lead time area for some products. If the "special" depreciation allowance for US customers is not extended beyond 2004, there will be intense pressure from those customers to install before year end. That could drive headcount increases in manufacturing at AMAT.