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

To: Proud_Infidel who wrote (15373)	7/12/2005 7:23:49 AM
From: Fred Levine	Read Replies (1) \| Respond to of 25522

Reuters Novellus sees doubling market share Monday July 11, 11:07 pm ET By Eric Auchard SAN FRANCISCO (Reuters) - Novellus Systems Inc. (NasdaqNM:NVLS - News), one of the top 10 makers of microchip production tools, can double its share of the markets where it competes to 40 percent in five years, executives said on Monday. ADVERTISEMENT Novellus executives told a meeting of Wall Street analysts here that the company is looking to make big strides in two of the biggest markets for semiconductor production gear, building on its existing strength in a range of smaller segments. Tom St. Dennis, an executive vice president, said he expected Novellus' market share to increase to around 40 percent from the 20 percent to 25 percent it held in 2004. "We believe that in the next five years, Novellus can double its share to 40 percent," St. Dennis said. Two key areas will be physical vapor deposition (PVD) and chemical vapor deposition (CVD) -- two of the most common techniques for producing electronic circuits, and areas industry giant Applied Materials Inc. (NasdaqNM:AMAT - News) now dominates. "Applied Materials currently dominates these markets and their customers have been crying out for a credible second source," Mark Fitzgerald, an analyst with Bank of America Securities, said of Novellus' opportunity to gain share there. PROGRESS ON BIG NEW MARKETS Novellus executives declined to comment on their near-term financial outlook, saying the company was keeping quiet ahead of its quarterly earnings report next week. Instead, the company, a diversified maker of tools that deposit ultra-thin layers of metals onto silicon in order to fabricate computer chips, made several product announcements. Novellus said it was introducing INOVA NExT, a new version of its existing INOVA physical vapor deposition chip-building technology. The market for PVD systems is forecast at around $1.2 billion in 2005 by Gartner Dataquest. INOVA NExT is designed to work with advanced 300 millimeter wafer technology in future generations of chips. This is aimed at making circuits at 45 nanometer and smaller. The most advanced chips now in commercial production are 65 nanometers. "We continue to build market momentum in the PVD business through the success of the INOVA platform," Rao Mulpuri, general manager of Novellus' Integrated Metals unit said. "By the end of 2005, we expect to triple the number of 300 (millimeter) INOVA customers compared to early 2004," Mulpuri told analysts. The number of those customers will rise to around 16 from five currently, he said. Novellus has no more than 10 percent of the overall PVD market but recent customer wins, once the customers move into high-volume production, should dramatically increase its market share, St. Dennis said. Novellus President Sasson Somekh said the company has begun testing with three customers on a second major growth area for the company called chemical mechanical platinization (CMP). "We believe CMP is really a major opportunity for us," Somekh said in response to an analyst's question about what areas can help Novellus expand its overall market share. fred