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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Paul V. who wrote (20444)	6/16/1998 4:12:00 PM
From: Teri Skogerboe	Respond to of 70976

Welcome home, Paul! Re: "Holding AMAT right now?" No... Sounds like you had a pleasant trip ;-)... A story below that contains part of Jay Deahna's take on this. techweb.com Excerpt: The worldwide chip industry has far more capacity than it requires, according to Jay Deahna, semiconductor equipment analyst at Morgan Stanley. He said he does not believe semiconductor manufacturers will begin to invest in new capacity until mid-1999. For next year, Deahna is now predicting a modest 5 percent growth. Although Deahna said a third quarter inflection in the semiconductor segment might help to stabilize the chip-production equipment industry, he said wafer fab utilization rates are so low an uptick in the segment was unlikely. World foundry leader Taiwan Semiconductor Manufacturing reported only 70 percent utilization in May, down from 80 percent in April and 100 percent at the start of the year. Its cross-town rival United Microelectronics is said to be even lower, and some of its lines have been assigned to producing dynamic RAM chips as filler. Morgan Stanley is also lowering its earnings estimates for both companies. Applied is now expected to generate earnings per share of 89 cents in calendar 1998, down from $1.09, while KLA's EPS were lowered to $1.20, down from $1.52. KLA's revenues are now predicted to fall 15 percent this year, much lower than Morgan Stanley's earlier prediction of a 4 percent decline, and Applied is now estimated to decline by 20 percent instead of the earlier prediction of a 10 percent drop. ----