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

To: Gottfried who wrote (12252)	12/1/2004 10:14:23 AM
From: Proud_Infidel	Respond to of 25522

Excellent chart G.....never saw this one. Interesting that the lines farther to the right(05, 06, 07) have lower expectations than those of the left to start the year out. Is this people overeacting and pulling in their horns at precisely the wrong time after being proven wrong on multiple occasions? Only time will tell of course, but it is an interesting thing to see. Brian

To: Gottfried who wrote (12252)	12/2/2004 10:35:42 AM
From: Proud_Infidel	Read Replies (1) \| Respond to of 25522

Chip market to contract 2 percent in 2005, says IDC By Peter Clarke Silicon Strategies 12/02/2004, 9:09 AM ET SAN MATEO, Calif. — The worldwide annual semiconductor market is set to contract by 2 percent in 2005, according to the latest prediction from market research company IDC. IDC said the market would return to growth in 2006, but did not quantify this. IDC said the market would experience a five-year compound annual growth rate of 11.3 percent from 2003 through 2008. The worldwide semiconductor market has entered a correction phase triggered by supplier expectations of high demand and resulting overproduction, the firm said. This correction is not set to impact the 26 percent worldwide revenue growth now forecast by IDC for 2004, the firm said. At the beginning of 2004 IDC predicted the worldwide semiconductor business would grow 18 percent in 2004 compared with 2003. IDC's prediction of a market contraction due to an inventory correction means it is one of the more bearish of market researchers. "The correction was brought on by production plans that outstripped real demand," said Mario Morales, vice president of semiconductor research at IDC, in a statement. "A series of order cancellations and OEM push-outs in the middle of the year resulted in an inventory overhang for suppliers. These inventories will linger into the first half of 2005 as suppliers adjust to meet market conditions. Meanwhile, cutbacks in capital spending and new wafer starts should enable prices to stabilize in the second half of 2005, as suppliers shift priorities from focusing on market share and market expansion toward operational execution." Supplier expectations for a strong market led to a 48 percent surge in capital spending in 2004. However, significant variations in monthly demand forced manufacturers to slow production in the second half of the year. Despite these adjustments, 2004 is still set to produce total revenues reaching $210 billion, IDC said. This would be the highest annual total revenue ever recorded, beating the boom year of 2000. IDC expects the first half of 2005 will be marked by increased price pressures, lower utilization rates, and greatly reduced capital spending as suppliers seek to help the market stabilize. A continuation of the corporate PC and mobile phone replacement cycles and growing demand for consumer electronics should help suppliers clear their lingering inventory and return to growth by the second half of 2005. To take advantage of the market recovery in 2006 and beyond, suppliers must adjust their business models to adapt to shorter opportunity windows and regional demand trends. With many device markets maturing, usage models are overtaking pure technology as the basis for many design decisions and innovation. Semiconductor suppliers will continue to migrate from point products to systems solutions in order to capture the opportunity across most system areas. This will accelerate a healthy level of consolidation and restructuring among semiconductor suppliers.