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

To: matt dillabough who wrote (14956)	5/13/2005 1:22:37 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 25522

Applied trims headcount amid order declines, says analyst Mark LaPedus EE Times (05/13/2005 12:24 PM EDT) SAN JOSE, Calif. — Applied Materials Inc. is quietly rebalancing — and trimming — its headcount amid an effort to cut costs and offset order declines, according to an analyst. Sources indicated that Applied (Santa Clara, Calif.) began to implement select headcount reductions last week, with more layoffs expected at the world's largest chip-equipment maker. "The company is undergoing rapid changes with headcount reductions expected at the divisional level such as global services, etch and ion implant, while the CVD, PVD and AKT (flat panel equipment) are maintaining or absorbing internal transfers," said Bill Ong, an analyst with American Technology Research Inc. in San Francisco, in a report on Friday (May 13). "We believe several business units have already implemented headcount reductions such as the global services group, the etch group and the ion implant group," Ong said. Applied has yet to issue a press release on the reported actions. "By delegating staff reduction responsibilities to the division level, a sizable cut in staffing within the divisional group would translate to a smaller material impact as a company aggregate and thus is not likely to warrant a formal press announcement," the analyst said. A spokesman for Applied said the company would not comment on the report, saying it is currently in the "quiet period." Applied is scheduled to release its quarterly results on May 17. Applied had about 12,900 employees at the end of its January quarter, where about 700 of these employees were from Metron. In a move to expand its service business, Applied in April acquired the operating subsidiaries and businesses of Metron Technology N.V. for $85 million. The former Metron operation is expected to experience the brunt of the cutbacks. "We believe the global service group could see a more sizable headcount reduction as it absorbs Metron's service business," Ong said. Amid a huge drop in orders, Applied in February posted sales of $1.78 billion for its first fiscal quarter, down 19 percent from the previous period, and up 14 percent from a year ago. Net income was $289 million, or $0.17 per share, down from net income of $455 million, or $0.27 per share, from the previous period and from net income of $82 million, or $0.05 per share, for the first fiscal quarter of 2004. New orders of $1.68 billion for the first fiscal quarter of 2005 decreased a staggering 36 percent from $2.62 billion for the fourth fiscal quarter of 2004. Applied is projected to meet Wall Street's expectations for its second fiscal quarter. The company is expected to earn $0.17 a share on sales of $1.8 billion for the period, according to Ong. Orders are expected to decline sequentially by 5 percent at $1.6 billion. Applied guided April quarter orders to be sequentially flat to down 10 percent, he said. For the June quarter, Applied appears to have turned the corner. "Based on our various industry checks, we believe orders have stabilized and Applied could see July quarter orders up at least 5 percent sequentially with business rebounding slightly from Taiwan and Japan," he said.