Advanced Micro Devices Inc (AMD)

[dhellman]

N. American chip equipment orders up in February
book-to-bill ratio, of 0.99
http://biz.yahoo.com/rc/030318/tech_semiconductors_equipment_1.html

(Updates with more details, background)
SAN FRANCISCO, March 18 (Reuters) - Orders for semiconductor production and testing equipment from North American manufacturers inched up in February, but have been essentially flat for six months as the chip industry struggles to recover from its worst ever downturn, a trade group said on Tuesday.


The three-month average of worldwide orders was $782 million, up 6 percent from January revised orders of $739 million and up 6 percent from the $737 million in orders posted a year earlier, according to Semiconductor Equipment and Materials International (SEMI).

Equipment billings, a measure of the value of equipment accepted by customers and booked as revenue, was $793 million in February, up 1 percent from January's revised level of $784 million and down 3 percent from $818 million a year earlier.

The statistics indicate a ratio of orders to billings, known as the book-to-bill ratio, of 0.99, which means that $99 worth of new orders were received for every $100 of product billed for the month, the San Jose, California-based trade group said.

"Bookings of new semiconductor manufacturing equipment have remained essentially flat for the last six months and as a result, a number of equipment manufacturers have announced recently plans for further consolidating and restructuring of operations and product offerings," Stanley Myers, president and chief executive of SEMI said in a statement.

"While the bookings outlook appears sluggish, over 20 new fabs are expected to begin production in the next two years," he added.

Worldwide chip equipment sales fell about 32 percent in 2002 from $28 billion in 2001 as chip makers cut back on plans to expand and upgrade factories, according to SEMI.

On Monday, Applied Materials Inc. (NasdaqNM:AMAT - News), the world's biggest maker of computer chip production tools, said it would close offices and cut 2,000 jobs, or 14 percent of its workforce, in its second major round of layoffs in five months.

Intel Corp. (NasdaqNM:INTC - News), the biggest purchaser of chip production equipment, has said it would cut its capital spending budget by as much as $1.2 billion from last year's level of $4.7 billion.

North American manufacturers of chip equipment represent more than half the total world market.

While considered by some as a poor indicator of chip equipment sales, the monthly book-to-bill numbers serve as a guide to the severity of the current chip slump.

Data released last last week from the U.S. Federal Reserve Board showed that fab utilization at semiconductor and related electronic component plants in the United States rose slightly in February to 68.4 percent from 66.5 percent the month before.