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Technology Stocks : Micron Only Forum -- Ignore unavailable to you. Want to Upgrade?

To: DJBEINO who wrote (45579)	5/4/1999 12:56:00 AM
From: Carl R.	Read Replies (3) \| Respond to of 53903

David Wu also upgraded AMAT today. He presumably is taking the view that the DRAM producers will repeat 1997 and order another round of equipment (good for equipment, bad for DRAM). I lean towards that scenario myself. As Tad has pointed out, in order for the semi recovery to really take place the equipment business needs to recover slowly, allowing the semis time to work off excess capacity. However just like the game "prisoner's dilemma", each DRAM producer optimizes their own profit by ordering equipment, while all are better off if none order equipment. In the absence of conspiratorial agreements they will each order equipment, even though they are all worse off as a result. Carl

To: DJBEINO who wrote (45579)	5/4/1999 8:19:00 AM
From: Carl R.	Respond to of 53903

Highlights from a post on another thread: Message 9297822 Samsung increases semiconductor capital expenditures from 2.1 to 2.5 trillion won, up from 1 trillion won in 1998 to aggressively ramp up sub 0.20 micron capacity in an attempt to keep pace with Micron. The Company's capital spending is predicated on an average 1999 64 Mb DRAM price of $7.0-$7.50 (with a $6 price exiting 1999). At YE 1998 Samsung was 60% at .3µ, and 20% at .21-.23µ, and they expect to be 80% at .21µ-.23µ by year end 1999. Ramps of .21µ and .18µ are going on schedule. Hyundai on the other hand, due to its financial structure, maintains capex flattish at $750 million. Spending for Oregon will be a modest $120 million, down from $280 million in 1998. They expect to transition Oregon from .28µ to .22µ by 4Q99. Their Fab 7 they expect to be at .22µ by 3Q99. Overall they expect to be 90% at .22µ by year end 1999. A further drop in DRAM prices will affect the combined Hyundai/LG's capex spending commitment. Carl