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

To: orkrious who wrote (29889)	5/3/1999 8:21:00 AM
From: Jeffrey D	Respond to of 70976

I don't think I saw this posted here. direct from James Morgan himself. Jeff Applied Materials CEO Says Demand Is Strong: Bloomberg Forum Applied Materials CEO Says Demand Is Strong: Bloomberg Forum New York, April 29 (Bloomberg) -- Applied Materials Inc. Chairman James C. Morgan said the No. 1 maker of semiconductor equipment expects fiscal second-quarter sales to be more than 20 percent higher than the first quarter's, as chipmakers order new machines and the industry recovers from last year's slump. ''The industry is clearly recovering and we are beginning to see that,'' Morgan, who is also chief executive, told the Bloomberg Forum. Applied Materials' sales for the quarter ended Sunday ''were probably over $900 million,'' Morgan said, compared with $742.5 million for the first quarter ended Jan. 31. Still, Morgan's estimate means revenue probably dropped more than 20 percent from the year-ago quarter, when the company had sales of $1.18 billion. Applied shares fell as much as 11 percent today amid concern that tumbling memory-chip prices could force chip manufacturers to pare equipment spending, which may cut into the rebound in sales of Applied's chipmaking tools. ''We don't manage the company for the minute. We manage it for the long-term,'' Morgan said of the stock's plunge today. Shares fell 3 to 51 3/16 in late trading, down almost 30 percent from a high of 71 5/8 reached Feb. 17. Morgan reiterated his February guidance that the company will have second-quarter profit of 22 to 25 cents a share. Analysts expect earnings of 26 cents, the average forecast gathered by First Call Corp. Estimates range from 22 to 31 cents. A year ago, Santa Clara, California-based Applied had net income of $141.2 million, or 37 cents a share. 'Gaining Share' ''We're gaining share and making progress,'' because the semiconductor industry is seeing robust growth worldwide, Morgan said. Asian customers, which account for about half of sales, are ordering new machines. ''This is just beginning. We've seen a lot of small orders from a large number of customers,'' he said. The company also could benefit from the move to smaller chip dimensions, said Morgan, 61, who's been Applied's chairman since 1987 and chief executive since 1977. Customers are looking to start building chips at sizes of 0.18 microns, down from 0.25 microns. A micron is about 1/25,000th of an inch. Intel Corp., the world's largest chipmaker, said this month that it began making a mobile version of its Pentium II chip at 0.18 microns. ''This is just starting,'' Morgan said. Sales of equipment that handle this production now ''are a very small percentage.'' Interest in new technologies, especially efforts to use copper for chips, also bodes well for the company, he said. Applied, which has twice the market share of No. 2 Tokyo Electron Corp., expects half of all machines that etch semiconductor designs to use copper ''within five years,'' Morgan said. Companies such as Motorola Inc., Advanced Micro Devices Inc. and International Business Machines Corp. have unveiled major programs to make copper chips, he said. Applied Materials now has machines that can handle seven of the nine steps required to make copper chips. Software The company also strengthened its software expertise with its December purchase of Consilium Inc., a Mountain View, California, developer of manufacturing software. ''This is essential for large machines that make small chips,'' Morgan said. Last year's slump ''was a tough period for us,'' Morgan said. Applied Materials trimmed 15 percent of its workers last year to cut costs as sales dropped. The company ''pulled together on a global basis'' to focus on new technology, he said. >>