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 : Spansion Inc. -- Ignore unavailable to you. Want to Upgrade?

To: BUGGI-WO who wrote (3651)	3/31/2008 8:56:26 AM
From: Rink	Read Replies (1) \| Respond to of 4590

Buggi, This earlier TI report is likely what's being refered to here too: ...Texas Instruments said the warning came after one of its key clients cut plans for building third-generation advanced phones in the preceding week or so. Analysts said that the 3G customer, which TI did not name, was likely to be Nokia, its biggest client for mobile chips. ... Citing weak wireless demand, especially for third-generation high-end chips, TI cut its January-to-March quarter profit forecast and sales target ranges on Monday. ... reuters.com So weakness is concentrated in high end cell phones, a relatively small portion of Spansion's shipments, albeit high margin too. It's possibly worse for for Spansion's partner SMIC that is set to produce 2-8Gb NAND chips. It's certainly not an indicator for good Q2 guidance. BTW this newer SIA report is contradicting the message you posted over the weekend: Message 24450127 Which one do you think uses the newest data? Regards, Rink

To: BUGGI-WO who wrote (3651)	3/31/2008 10:39:03 AM
From: bobs10	Respond to of 4590

you: Nokia began cancelling orders for handset components in March. Our field checks suggest Nokia may not again order until May. me: I wonder how much of that has to do with Eclipse? SPSN has been saying H208 for revenues from Eclipse all along. If Eclipse really is the sort of paradigm changing event management seems to believe it to be then that schedule would be consistent with Nokia wanting to clear out some/all of its older NOR/NAND/DRAM, NOR/ORNAND/DRAM inventory. Nokia started receiving Eclipse test samples in q407. Also, in the q4 CC management complained that certain manufactures had pushed out some products affecting q4 margins. It's hard to say what's going on but maybe it didn't make sense to create new products without Eclipse and the products had to be altered, maybe a lot? Last year SPSN built up inventory for the Chinese New Year ramp. Nokia may have gotten enough of that inventory to tide them through the transition period. For SPSN, I assume that those older inventories are being depleted quickly and that SPSN has been building up inventories of Eclipse modules since q307. Trying to transition to wholly new products can be challenging so I wouldn't write off q2 as yet. Ending Q1 Inventory figures should make for interesting reading if management gives a product break out. The bad news is that TSMC is probably still being used to cover the transition. That means that the $50m savings is probably further down the road. Anyway, all this is just convenient speculation and no one really knows what's really going on. Still....