to Feb 2010

Technology Headlines – 02 November 2009

TSMC targets 10% EPS CAGR over 2011-15, says chairman: TSMC stands a chance of hitting record rev and profits in 2010, when demand will rebound stronger than expected, according to company chairman and CEO Morris Chang. Later TSMC clarified that that setting a company record for profits in 2010 is an internal target and should not be viewed as a financial forecast. Chang also revealed TSMC's target for a 10% compound annual growth rate (CAGR) for EPS in 2011-2015. Chang noted that days-of-inventory (DOI) at IC designers and IDMs have fallen to appropriate levels and TSMC expects overall semiconductor market may contract by 12% in 2009 (vs. prev 17% shrink). TSMC has also raised its estimates for worldwide PC unit shipments for 2009 to an annual growth of 2% from the previous prediction of negative 4%, to be followed by an 11% rise in 2010. (Digitimes, EE Times)

Compal 3Q09 - rev up 41.8% q/q; says shipments to grow more than 20% in 2010: Compal had rev of NT$172.91b (US$5.31b) for 3Q09 with net profits of NT$5.14b and EPS of NT$1.32. Compal sees it Q4 notebook shipments grow 10% q/q to reach its newly forecasted annual shipment goal of more than 36.5m units, followed by more than 20% y/y growth to reach 44m units in 2010. Compal chairman Ray Chen said that global demand for notebooks (including netbooks) will top 190-200m units in 2010 compared to 155-160m units projected for 2009, as Windows 7 will trigger enterprises to resume their PC replacement cycle in 2010. Chen added that global PC demand will reach 400m units by 2013-2014, of which, 75-80% will be notebooks. (Digitimes)

ASML/Brion contract with Chartered: Brion Technologies has reached a multi-year agreement with Chartered Semiconductor, to implement a broad suite of computational lithography products. Chartered will use Tachyon™ OPC+ (optical proximity correction), Tachyon LMC (lithography manufacturability check), and Tachyon resolution enhancement products to design and manufacture 45-nanometer (nm) and below technology node devices (ASML).

Sony F2Q09 - rev miss, EPS loss narrower than ests; trims FY loss guid: Sony posted F2Q09 (ended Sept) rev of $18.46b (-19.8% y/y in yen) and below cons $19.17b. However, the company lost 29c in the quarter, less than cons estimated loss of 37c. On the other hand, Sony notes that operating income before restructuring charges and equity in affiliates was actually up 16% y/y. The company saw declines of 36.5% in the consumer segment, 24.2% in networking, 19.6% in B2B and disc and 30.4% in Sony Pictures. But Sony Music revenues rose 147%, and financial services was up 101%. For the Mar 2010 fiscal year, Sony maintains its rev forecast of 7.3t Yen, but the company reduced its estimated loss for the year to 95b Yen, from 120b Yen. (TechTrader)

Panasonic F2Q09 - raises FY2009 operating profit guid: Panasonic said it had cut 209.3b Yen from costs in the first half and raised its full-year operating profit forecast to 120b Yen from 75b Yen. It cut its estimated net loss from 195b Yen to 140b Yen. It said it did not expect the electronics industry to make a rapid recovery. Second-quarter operating profit was 49.1b Yen, against an operating loss of 20.2b Yen for the previous quarter. (FT)

Wistron 3Q09 - rev up 15.1%: Wistron posted 3Q09 consolidated rev of NT$146.45b for 3Q09 with net profits of NT$2.72b and EPS of NT$1.47. Wistron pointed out the growth in Q3 was mainly contributed by increased shipments from its notebook, LCD TV and other digital products businesses. (Digitimes)

Asustek aims to increase revenues by about 30% in 2010: Asustek posted 3Q09 consolidated rev of NT$68.24b (+39.3% q/q), while net profits reached NT$6.5b and EPS was NT$1.52. It expects that its 2010 rev will have a chance to approach NT$300b (US$9.23b), which would represent on-year growth of about 30%. The company is also aiming to rake in profits of NT$18-20b in 2010 as it goes about improving its organizational structure, according to company CEO and President Jerry Shen. Shen estimates Asustek's total rev, as well as its shipments of notebooks and netbooks will increase about 10% q/q in Q4. (Digitimes)

Technology Headlines – 03 November 2009

SIA - Global chip sales rise 19.7% q/q in 3Q09: to $61.9b from $51.7b in 2Q09. "September sales were in line with historical patterns, reflecting increased demand from end-users as they began the build for the holiday season," SIA said, adding that unit sales of PCs and cell phones continue to run ahead of earlier forecasts. "Sales are running well ahead of the worst-case scenarios projected early in the year, and we are optimistic that total sales for 2009 will be better than our mid-year forecast," SIA said. Also, the demand for semiconductors for industrial applications - a sector that had declined sharply - showed initial signs of recovery, SIA said. (Reuters)

Ensnared in Galleon scandal, Ex-AMD CEO Ruiz quits as GlobalFoundries chairman: Media reports have said Ruiz passed on confidential information regarding AMD's spinoff of GlobalFoundries to a hedge fund manager when he was AMD's CEO. Ruiz has not so far been charged, nor has he been named by federal investigators working on the case. GlobalFoundries said on Monday that Ruiz would immediately take a voluntary leave of absence and resign from the company, effective Jan. 4. Although Ruiz, 64, is embroiled in scandal, some analysts said they saw no connection to his departure, adding that he was reaching retirement age anyway. (Reuters)

Top vendors increase NAND flash market share, says DRAMeXchange: with the total sales of the top six NAND flash makers up 21.6% q/q to $3.35b compared to 17% q/q increase in total branded NAND flash shipments. With sales of $1.29b in Q3 Samsung had 38.5% market share, followed by Toshiba with 34.7% market share and $1.16b rev. Micron ranks No.3 with 9.4% market share and $316m rev while Hynix takes the fourth slot with $291m rev. Intel and Numonyx grab fifth and sixth positions with sales of $219m and $75m respectively. (EE Times)

Renesas to transfer fab tool unit to Hitachi: Seeking to cut costs amid a major merger, Renesas announced a basic agreement for the transfer of its semiconductor manufacturing equipment subsidiary - Renesas Eastern Japan Semiconductor - to Hitachi High-Technologies. Specifically, the transfer will see Renesas Eastern Japan Semiconductor as the absorbed company, with Hitachi High-Tech Instruments as the surviving company. The deal is expected to be completed by next spring. Renesas Eastern Japan Semiconductor is currently in charge of the development and manufacture of semiconductor manufacturing equipment. Hitachi High-Technologies is responsible for global sales of these products. (EE Times)

MIPS debuts new cores, instruction set: ARM rival MIPS disclosed details of a new M14K core, an upgrade of its M4K core for microcontrollers and a new M14Kc core, an upgrade of its M4KE used in more sophisticated consumer systems. Both support as an option a new microMips instruction set that the company claims provides 32-bit performance at 16-bit code compression levels. The 14K core, and the promise of a 35% reduction in code size using the new microMips instructions, could help the company ride a wave of expected growth in the 32-bit microcontroller market. Today MIPS has a market share measured in single digits for the highly competitive 32-bit controller market thanks to its licensees MicroChip, NEC and Toshiba. (EE Times)

Technology Headlines – 04 November 2009
Jury finds for TSMC over SMIC in trade secrets case: The California Superior Court jury ruled on Tuesday (Nov. 3) that SMIC has been misappropriating TSMC trade secrets since Jan 2005, after the firms reached an agreement to settle allegations of corporate espionage and IP infringement, according to the attorney. An attorney involved in the case declined to speculate on the amount TSMC would be awarded, saying it was for the jury decide. But he added that SMIC has said publicly that the amount being sought is between $1b and $3b. (EE Times)

DRAM contract prices to rise by double-digits in Nov, says Nanya: Contract quotes for DRAM chips may continue to grow by a double-digit percentage in November, according to Pai Pei-Lin, VP and spokesperson of Nanya Technology. Pai said he does not see a downward correction in the short term, as demand from PC OEMs remains strong. Contract prices for 1Gb DDR2 and 1Gb DDR3 chips rose 15.7% and 10.9%, respectively, to US$2.06 and US$1.94 on average in the latter part of Oct, according to latest data posted by DRAMeXchange. (Digitimes)

US$2.50 reasonable for DRAM, says Kingston Technology Far East: US$2.50 is a healthy price level for both DRAM makers and PC ODM/OEM makers, according to Kingston Technology Far East chairman DK Tsai, who also heads packaging and testing firm Powertech Technology (PTI). Tsai pointed out that DRAM production costs are US$2.20-2.30 based on 70nm processes, US$1.80-2 on 60nm and about US$1.50 on 50nm, implying DRAM makers can profit from US$2.50 price levels. The current shortage of DRAM chips is mainly the result of suppliers having insufficient capacity to meet the recent rebound in demand, Tsai commented, adding his prediction that there will be no off-season demand until 2010. (Digitimes)

Specialty IC foundry VIS conservative about 4Q09: Analog/mixed-signal and logic IC specialist Vanguard International Semiconductor (VIS) saw Q3 rev grow 27% q/q to NT$4.34b (US$133m), and shipments increase 25% to 284,000 wafers, leading to GM of 22% (+800bps q/q) and utilization rate reached of 74%. It has estimated wafer shipments to decrease by around 30% q/q in Q4 leading to 50% utilization rate and high single-digit percent GM. The company cited seasonality and inventory control at its customers as the main drivers of the expected decline. (Digitimes)

Technology Headlines – 05 November 2009
Qualcomm F4Q09 - rev, EPS miss; Q1, FY 2010 outlook below ests: Qualcomm posted F4Q09 (ended Sep 27) rev of $2.69b (-19% y/y,-2% q/q) below cons $2.72b and diluted EPS of 48c below cons 52c. For F1Q10, it sees rev of $2.55-2.75b below cons $2.84b and EPS ex-special items of 54-58c in line with cons 56c at the midpoint. On a GAAP basis, it sees EPS of 41-45c. For FY2010, it rev of $10.5-11.3b vs. cons $11.6b and EPS (ex-items) of $2.10-$2.30 vs. cons $2.32, citing aggressive competition in the mobile phone chip market along with slowing handset upgrades by consumers. (Reuters, TechTrader)

Qualcomm extends deal with Samsung; to get $1.3b down payment: Samsung said that it would make a $1.3b down payment to Qualcomm under a new wireless license agreement but neither company would disclose the phone maker's ongoing royalty rates. Samsung added that the contract would last 15 years and would involve another recurring royalty payment, which it did not specify. Qualcomm executives said that the company was happy with the value it is getting from the new 15-year Samsung pact, which includes current wireless technology standards as well as next-gen technologies. (Reuters)

Infineon/TSMC 65nm embedded flash collaboration: Infineon and TSMC announced they are extending their development and production partnership to a 65nm embedded flash (eFlash) technology targeting next generation automotive, chip card and security applications. Based on the agreement, Infineon and TSMC will jointly develop 65nm process technologies for eFlash microcontrollers (MCUs) that fulfil the stringent quality requirements of the automotive industry, as well as the demanding security requirements of the chip card and security markets (Infineon).

Intel hit by NY antitrust suit, kickbacks alleged: Intel was sued by New York Attorney General Andrew Cuomo, who accused the world's largest chipmaker of threatening computer makers and paying billions of dollars in kickbacks to maintain its market dominance, at the expense of rival AMD. Cuomo said Intel for several years bribed or coerced computer makers such as Dell, HP and IBM to use its microprocessors or stop using those of rivals. The alleged wrongdoing included kickbacks in the form of "rebates" and threats of retaliation for using rival chips. Top officers including Intel CEO Paul Otellini were aware of some of the activity, according to emails cited in the lawsuit. Intel spokesman said the company would defend itself against Cuomo's charges. (Reuters)

ON Semi 3Q09 - rev, EPS beat, sees strong Q4 rev: Chipmaker ON Semiconductor posted 3Q09 rev of $472.9m (-19% y/y) vs. cons $455.5m and EPS (excl. items) of 16c beat cons 10c. GM rose to 37.2% (+430bps q/q). In terms of rev segments, computing end mkt, accounting for 27% of rev, grew 13% q/q, automotive (18% of rev) rose 20% q/q helped by the clash for clunkers incentive program, and consumer (17% of rev) grew 43% q/q due to back-to-school and holiday demand. It sees Q4 rev of $480-495m vs. cons $468.3m. Looking to 1Q10, a company official said "We are getting a picture from our customers that their demand continues to strengthen and they are more bullish about the first quarter than we have been in many years" (Reuters)

Microchip FY Q2 Tops Estimates; Div Increased Slightly: Microcontroller and analog chip vendor Microchip posted F2Q10 (ended Sep 30) rev of $226.7m ahead of cons $218.3m and non-GAAP EPS of 29c beat cons 21c. Results exceeded the company’s Sep guid. For FY Q3, the company sees rev of $236-245m vs. cons $224.1m, with non-GAAP EPS of 33-35c vs. cons 24c. The company also said that its internal plan for calendar 2010 is for rev of $1.05b and non-GAAP EPS of $1.50; note that for the March 2011 fiscal year the Street has been expecting $981.5m and $1.22 a share. Meanwhile, Microchip boosted its quarterly dividend rate to 34c, from 33.9c. (TechTrader)

BT sued MediaTek, claiming it infringes a patent for data compression and encoding. BT wants compensation for the use of its invention, according to the complaint filed Nov. 2 in federal court in Boston. BT, has sued chipmakers Broadcom, Texas Instruments Inc. and Freescale Semiconductor Inc. over the same patent. (Bloomberg)


Technology Headlines – 06 November 2009

SIA - sees global chip sales down 11.6% in 2009, +10.2% in 2010, +8.4% in 2011: Worldwide semiconductor sales this year will drop 11.6% this year to $219.7b, but then rebound 10.2% next year to $242.1b, according to a new forecast from the Semiconductor Industry Association. The SIA sees 2011 sales growing 8.4% to $262.3b. “The new forecast is brighter than our earlier projections, reflecting an improving global economy,” SIA President George Scalise said, adding “Unit sales of key demand drivers – including PCs and cell phones, which together account for about 60% of semiconductor demand – have been stronger than previously predicted. We remain cautiously optimistic for the longer term. The current forecast is closely tied to projections of continuing improvement in the worldwide economy.” (TechTrader)

Elpida ups capex: Elpida has revised upward its fiscal year 2009 capital investment forecast of 40 billion yen ($442.3 million) issued Aug. 4, to 60 billion yen ($663.4 million), mainly for the purpose of investing in manufacturing equipment for 40-nm process technology (EE Times).

Nanya to raise NT$16 billion: Nanya Technology on Nov 5 announced its board of directors has approved plans to raise an estimated NT$16b (US$491m) by issuing 800m new shares. The DRAM maker also said it is planning secure syndicated loans for an additional NT$18b later in Nov. The Nanya board has tentatively settled on an issue price of NT$20 per share, and set its schedule for releasing the new shares on Nov 28. The new capital will be used to repay corporate bonds and equipment purchases at Nanya's 300mm (12-inch) Fab-3A, according to the company. Nanya raised NT$12.2b through private placement in June, with members from the Formosa Plastics Group subscribing to the shares. The DRAM maker recently said its technology migration from trench to stack in preparation for a 50nm production ramp-up in 1Q10 was completed in early October. Nanya's capex budget for 2010 is estimated at NT$19b, compared to NT$13b allocated for 2009. (Digitimes)

Nvidia F3Q10 - rev, EPS top ests: sees F4Q10 rev ahead of ests: Graphics chip producer Nvidia reported F3Q10 (ended Oct 25) rev of $903.2m (+16% q/q, up slightly from a year ago) and well ahead of cons $838.1m. Non-GAAP EPS of 19c beat cons 10c. Non-GAAP GM of 41% was up 4.7 points from the 36.3% reported in F2Q10, though down from 41.9% a year ago. For Q4, the company sees reve up about 2% q/q, which implies $921.3m, above the Street at $868.1m. GAAP GM is expected to be 40%-42%, or down slightly from 43.4% in FY Q3. (TechTrader)

NEC plans $1.6b share sale after losses: Japan's biggest PC maker, plans to sell up to Y145b ($1.6b) worth of new shares. The issue will allow NEC, which lost Y297b in its last financial year, to keep investing in its business. As of the end of Sep 2009, NEC had net debt of Y692.3b, with a number of bonds due for redemption within the next year. Shareholders' equity was 21.7% of total assets. NEC is engaged in a restructuring aimed at cutting fixed costs by Y290b in the year to Mar 2010. The issue will dilute NEC's existing shareholders by 26%. (FT)

Lenovo reports profit despite sales drop: Lenovo, which bought IBM's PC business in 2005, said its net profit for the three months ended Sep 30 more than doubled to US$53.08m (vs. cons US$20.50m), from US$23.44m a year earlier. Revenue fell 5.2% to US$4.10b from US$4.33b a year earlier. Gross margin in the F2Q10 narrowed to 10.6% from 13.1% a year earlier, as it shifted focus to entry-level PCs and engaged in aggressive price competition. Lenovo's total world-wide PC shipments rose 17% y/y, while its market share rose to a record 8.9%. (WSJ)

Technology Headlines – 09 November 2009

Infineon completes the sale of Wireline business; Lantiq becomes a standalone company: Infineon and Lantiq today announced the closing of the sale of Infineon's Wireline business to Lantiq, an affiliate of the U.S. based investor Golden Gate Capital. The final purchase price will amount to approximately EUR 243m resulting from customary adjustments in the asset purchase agreement with Golden Gate Capital. Infineon is expected to record a book gain of more than EUR 100m as a result of this transaction in F1Q10. (Infineon, Reuters)

Skyworks F4Q9 - rev, EPS top forecasts; Q1 outlook upbeat: The maker of handset-related chips posted F4Q09 (ended Oct 2) rev of $228.1m, up 19% q/q, and ahead of the company’s forecast of $220m-225m, and cons $222.3m. Non-GAAP EPS of 25c beat cons 22c. For F1Q10, it sees rev of $238-242m vs. cons $230.8m, with non-GAAP EPS of 25c vs. cons 22c. (TechTrader)

MediaTek October rev’s down 15%: MediaTek has reported revenues of NT$9.64 billion (US$297.57 million) for October, down 15.33% on month. The IC designer's November revenues may continue to drop by within 10% as shipments for the end-year holiday season have completed. MediaTek has forecast a 13-19% decline in its fourth-quarter revenues to reach NT$27.8-29.8 billion. MediaTek's shipments of Blu-ray controllers, WiMAX chips and TV controllers will continue to grow in the fourth quarter, while its handset chip and DVD player chip product lines are declining due to seasonality, indicated the sources. (DigiTimes)

ProMOS signs deal with Elpida: ProMOS signed an agreement to provide manufacturing services to Japan's Elpida Memory. Elpida will also licence the technology needed to produce future generations of the memory chips to ProMOS. (FT)

Nvidia CEO says 'no' to Intel-compatible chip: Despite persistent rumors, Nvidia's CEO Jen-Hsun Huang said the graphics chip supplier is not working on an Intel-compatible chip. "No," he said when asked if there was any truth to the rumor. "Nvidia's strategy is very, very clear. I'm very straightforward about it. Right now, more than ever, we have to focus on visual and parallel computing." (cnet.com)

SMIC in Talks to Settle TSMC Suit: China’s biggest chipmaker Semiconductor Manufacturing International Corp (SMIC) is in talks with TSMC to settle a trade secrets lawsuit in the U.S., Reuters reported, citing a person it didn’t identify. The negotiations may result in an agreement on compensation next week, the newswire said. Matthew Szymanski, a Shanghai-based spokesman for SMIC, told Bloomberg News he couldn’t comment on the report. (Bloomberg)

Technology Headlines – 10 November 2009

TSMC - 40nm yields will improve by early 2010; reaches settlement with SMIC: In response to reports that it was facing 40-nm yield problems, TSMC said ""The 40-nm yield didn't drop as reported. As a matter of fact, yield on the 40-nm process remained flat. TSMC is confident that the 40-nm yield will improve at the beginning of next year." On Monday, TSMC reached an out-of-court settlement with China's Semiconductor Manufacturing International Corp (SMIC). Under the terms of the settlement, SMIC will pay TSMC $200m plus an undisclosed amount of SMIC stock and warrants. All other terms of the settlement are confidential. (EE Times)

UMC Oct rev down slightly: UMC has announced revenues for Oct 2009 slid 2.49% m/m to NT$9.297b (US$287m). UMC said at its Q3 investors conference that wafer shipments are likely to drop 0-3% on quarter in Q4, but ASPs may rise 0-3%. UMC saw Q3 rev increase 21.1% q/q, beating market watchers' estimates. (Digitimes)

Abu Dhabi fab within four years, says investor: "In four years, you'll see the first foundry in Abu Dhabi," the state-owned investment company Mubadala COO Waleed Al Muhari was reported to have said by Reuters. Mubadala owns 19.9% of processor maker AMD while a separate Abu Dhabi investment company, Advanced Technology Investment Co. LLC (ATIC) controls the newly-formed foundry GlobalFoundries that is the likely vehicle through which Abu Dhabi will start building chips at home. "We will be number two in two years," Muhari said. "It is an industry-changing move to create, at home, this business," he said, adding "we want to compete with Intel." (EE Times)

China's SMIC changes CEOs, could auger consolidation: SMIC founder Richard Chang had been replaced as CEO by industry veteran David Wang effective immediately, in a move that could pave the way for consolidation in China's struggling chip sector. After getting off to a relatively strong start, SMIC has languished over the last few years - notching quarterly losses in 16 of the last 17 quarters - as it tried to compete with larger, more established players like TSMC and UMC. Cash-strapped SMIC, whose share price has dropped steadily since its 2004 IPO, was looking for a strategic investor for much of last year and was reportedly talking with several potential major foreign partners, including Intel. (Reuters)

Samsung, Hynix continue to expand DRAM presence, says DRAMeXchange: Global DRAM revenues increased 40.7% q/q to US$5.719b in 3Q09, according to DRAMeXchange. Samsung Electronics increased its mkt share to 31.1%, up 2.1pp q/q, while Hynix had 23% of the mkt, up 0.2pp q/q. Spot and contract prices for DDR2 parts rose 30-31% q/q in 3Q09 on tighter supply. (Digitimes)

Emulex sues Broadcom, claims antitrust violations: Emulex said it filed a lawsuit alleging that Broadcom has acted in an anticompetitive manner in violation of federal antitrust laws. The antitrust claims seek unspecified damages, plus attorneys' fees and costs and injunctive relief, Emulex said. The complaint also seeks punitive damages against Broadcom for "malicious" conduct, Emulex said. Broadcom in Sep sued Emulex, claiming that the company infringes on 10 Broadcom patents related to networking and communications technologies. Earlier this year, Broadcom tried for several months to acquire Emulex. (EE Times)

Technology Headlines – 11 November 2009

TSMC Oct rev up 4%: TSMC has announced net sales of NT$29.18b (US$902m) for Oct (+4.1% m/m), bucking a seasonal trend that caused UMC to see Oct rev slide 2.5% m/m. On a consolidated basis, TSMC's Oct rev grew 4.4% m/m to NT$30.22b. TSMC has estimated Q4 consolidated rev at NT$90-92b, up slightly from NT$89.94b in Q3. (Digitimes)

TSMC board approves US$2.5b for 12-inch capacity expansion: TSMC board approved a budget of around US$2.24b to expand advanced technology capacity for 300mm (12-inch) wafer fabs and wafer-level chip scale packaging. The board also approved the allocation of US$254.6m to expand 12-inch wafer fab facilities. TSMC also revealed an approved budget of US$46m to set up a production line and product development lab for solid state lighting. (Digitimes)

Nanya Technology lands NT$18b in syndicated loans: Nanya Technology on Nov 9 signed on for a syndicated loan of NT$18b (US$554m), with the fund eARMarked for its process advancement, according to the company. The Taiwan-based DRAM producer is looking to migrate all of its 12-inch production (130,000 wafers per month) to 50nm process technology. In other news, Inotera Memories also plans to secure a syndicated loan by the end of 2009, in preparation for its capex hike for 2010, according to industry sources. The company was cited in previous reports as saying that its capex is estimated at NT$45b for 2010, a significant rise compared to NT$12.7-13.7b for 2009. (Digitimes)

Samsung loses US patent dispute with Sharp: The U.S. International Trade Commission (ITC) ruled that Samsung infringed four of Sharp patents for LCD contrast control technologies and must stop selling TV screens and computer monitors using them in the U.S. The ban will likely take effect in Jan, and meanwhile Samsung must post a bond worth 100% of the affected products pending a review of the ITC ruling by the executive branch. But Samsung Electronics said the ITC ruling will not have a big impact on sales of products because it has developed new screen contrast control technologies and will use them for new products from next year. (Chosun Ilbo)

Elpida says to outsource chips to Taiwan's Winbond: Japanese DRAM maker Elpida Memory said on Wed it will outsource production to Taiwan's Winbond Electronics in a bid to gain technological clout over U.S. rival Micron. Elpida, which last week announced a similar outsourcing agreement with Taiwan's ProMOS, has been seeking allies as it chases South Korea's Samsung Electronics and Hynix Semiconductor for market share. The Nikkei business daily said Elpida will supply 65-nm chip technology to Winbond, and is likely to outsource production worth roughly 20,000 to 30,000 300-mm wafers per month to Winbond. (Reuters)

Technology Headlines – 12 November 2009
Would-be Hynix buyer backs out citing ‘groundless’ speculation: South Korea's Hyosung said it abandoned a bid for Hynix Semiconductor because of speculation it received political favors to pursue the takeover. Hynix' largest shareholder, Korea Exchange Bank (KEB), said in a statement it would restart the process of selling the memory chip vendor, targeting local buyers, with all the creditors expected to meet on Nov 16. Last month, KEB and other Hynix creditors announced a delay in the sale of the chip vendor to Hyosung. Observers had been skeptical about the Hyosung bid, since Hyosung is roughly the same size as Hynix sales and has no experience in semiconductors. (EE Times, Reuters, Bloomberg)

Applied Materials F4Q09 - Results top ests; to cut staff 10%-12%; raises Q1, FY 2010 outlook: Fab tool vendor Applied Materials (AMAT) posted F4Q09 (ended Oct 25) rev of $1.53b (vs. $2.04b in F4Q08 and $1.13b in F3Q09), ahead of cons $1.32b. Non-GAAP EPS of 13c was well ahead of cons 3c. As expected, the company also announced a restructuring plan; AMAT will trim headcount by 10%-12%, eliminating 1,300-1,500 positions over an 18-month period. AMAT said the restructuring will save $450m a year; the company expects to recognize costs related to the cuts of $100-125m, most of that in the current quarter. It sees F1Q10 rev of $1.68-1.91b vs. cons $1.4b and non-GAAP EPS of 10-14c vs. cons 5c. FY2010 rev is expected to be up at least 30%, implying rev of at least $6.5b vs. cons $6.2b. Its CEO sees the semiconductor segment growing rev at least 40% for the year, with worldwide spending on chipmaking gear of $18-20b in calendar 2010, up from $12-13b in 2009. (TechTrader, Reuters)

Taiwan lawmakers reject investment for Taiwan Memory: Taiwan lawmakers rejected a public funding request for a state-led memory chipmaker set up to revive the industry and called for the project to be scrapped after semiconductor prices and demand rebounded. “The time for investing in the venture has passed,” ruling party legislator Ting Shou-chung said. “We demand the Ministry of Economic Affairs stop the project. The Cabinet should respect our decision.” Hwang Jung-chiou, vice economics minister told reporters today the ministry will halt processing applications for funding and will reassess the DRAM industry rescue plan. (Bloomberg)

China using Infineon chips for passports: The Chinese govt is using security microcontrollers from Infineon for its new electronic passports. Infineon announced that it recently started deliveries to the Chinese electronic passport project. As of 1Q10, all new Chinese passports will be issued as electronic passports. The Chinese government estimates that, beginning in the first full year of the roll-out, about 6.5m electronic passports will be handed out annually to citizens, diplomats and government workers. In total, there are currently more than 30m passports in circulation in China, which are usually valid for ten years. (Infineon)

Qualcomm capital markets day – set to show first smartbook design: At the Computek show in Taiwan six months ago, Qualcomm and Freescale coined a new phrase, 'smartbook', to describe a mobile internet device that would come somewhere between a smartphone and a netbook. Now the chip giant says it will show its first commercial design, at its analyst day to be held in New York on Thursday. Qualcomm expects the smartbook to be a new product category, combining low power and instant start-up with ultra-mobility (embedded 3G or 4G, plus Bluetooth, Wi-Fi and GPS) and a rich browser interface. Qualcomm did not reveal details of the design it will release this week, but said its key processor for this market, the 1GHz Snapdragon, is now included in 40 current or soon-to-be released devices, from 15 vendors. An early mover in smartbooks is expected to be Asustek, which demonstrated a prototype at Computek using Snapdragon, and Nokia is also working on a design in this area. (The Register)

TSMC, Infineon to collaborate on eFlash for automotive apps: TSMC, earlier this week agreed to cooperate with Infineon on 65-nm embedded flash process technology for automobiles, sources reported. The cooperation will also be extended to chip card and security applications. TSMC said quality testing and mass production for security applications are expected to be done in the second half of 2012. Testing and production for automotive applications will be initiated in the first half of 2013. (CKO, Bloomberg)

AMD expects key business to be profitable in 2010: AMD said it expects to report profits next year from its chip design business, the backbone of a company trying rebuild market share and better compete with rival Intel. AMD's debt rose to roughly $3.9b last year, but dropped to $3.2b as of the end of Q3 and its CFO Thomas Seifert said that the debt issue is "as high on our list of priorities as it can be." Seifert is hoping to keep as much as $1b cash on hand in the future, he said, but would use any excess cash to pay down the debt load. AMD said that business should remain profitable in 2010, while margins would run between 40%-45%, with the expectation of higher margins down the road. Along with new microprocessor and graphics chip designs, executives said AMD would focus on consumer-oriented market segments, including mid-range desktops and notebooks. (Reuters)

Foxconn sees second highest rev in Oct: Foxconn Electronics (Hon Hai Precision Industry) has reported unconsolidated rev of NT$162.13b (US$4.99b) for Oct 2009 (+8.49% m/m) and the second highest monthly figure on record. The on-month growth in October revenues was mainly contributed by PC and consumer electronics businesses, while the company's communication product line maintained sales performance, according to Foxconn spokesperson Edmund Ding. (Digitimes)

Technology Headlines – 13 November 2009

Intel to pay AMD $1.25 b, settle disputes: Intel will pay rival chipmaker AMD $1.25b to settle all outstanding legal disputes, in a move that can hasten the resolution of Intel's antitrust troubles. AMD agreed to withdraw essentially all its regulatory complaints and litigation against Intel, ending a global campaign that it has waged on the world's largest chipmaker for 12 years. Intel CEO Paul Otellini denied any wrongdoing by the company but said it decided to settle the dispute with AMD to avoid the risk of a triple-damages finding by a jury. AMD is expected to use the money to pay down some of its $3.2b of debt. Intel adjusted its Q4 outlook due to the settlement, raising its spending forecast to $4.2b from $2.9b. It said its effective tax rate would be about 20%, down from 26%. (Reuters)

BT Group’s British Telecom sues STMicro over data patent: British Telecommunications sued chipmaker STMicroelectronics in the U.S., demanding patent royalties for an invention related to data compression and encoding. (Bloomberg)

LG licenses Qualcomm for 4G technology: Qualcomm said LG Electronics has agreed to license its 4G high-speed wireless technology, following in the steps of its larger rivals Samsung Electronics and Nokia. LG also renewed its agreement for Qualcomm's existing 3G technology. Qualcomm CEO Paul Jacobs said he sees huge growth in mobile Web use on smartbooks and cited estimates that by 2014, monthly mobile data traffic will exceed the total for the full year 2008. (Reuters)

NXP licenses contactless IC technology to ST: European chip vendors NXP BV and STMicroelectronics have announced a licensing agreement for NXP's Mifare contactless IC technology which is the most widespread contactless technology around the world. ST is licensed to integrate the Mifare family into its security solutions for mobile phone and banking applications. The terms of the agreement and how much NXP expects to make from the licensing agreement were not disclosed. (EE Times)

Snapdragon to feature in Lenovo smartbook: Qualcomm announced that Lenovo’s smartbook mini-computer will use Qualcomm snapdragon chips and that the device will be sold by AT&T. (Reuters)

Qualcomm LTE chips to start shipping in 2H10: Qualcomm said on Thursday that it has started providing multi-mode high-speed wireless chips to customers on a trial basis as it looks to cash in on the move to next generation wireless services. The company said that device manufacturers now evaluating the new chips include Huawei, LG Electronics Inc, Novatel Wireless, Sierra Wireless and ZTE. Qualcomm said that devices based on its latest chips are expected to go on sale in the second half of 2010. Its MDM9200 chip supports HSPA Plus, a high-speed wireless technology that operators such as T-Mobile USA are going to install in their networks, and Long Term Evolution (LTE), which Verizon Wireless plans to use to upgrade its mobile network. (Reuters)

Qualcomm announced that it is sampling a new smartphone chipset family. The MSM7x30 family features a strong emphasis on multimedia performance, supporting high-definition video recording and playback, exceptional graphics with dedicated 2D and 3D cores, and an overall chip design optimized for a highly responsive, immersive Web experience. The first devices based on the flagship MSM7x30 family of chipsets are expected to launch commercially before the end of 2010. (Mobile Tech News)

ProMOS says partnership with Elpida not affected by fate of Taiwan Memory (TIMC): ProMOS on Nov 6 announced a deal to provide DDR3 foundry services for Elpida, about a month after confirming there had been a consensus on the possibility of cooperation between ProMOS and TIMC. Elpida is supposed to be TIMC's technology partner. Chen said ProMOS is scheduled to start trial runs on 65nm for Elpida's 1GB DDR3 chips in 1H10, with mass production slated for 2H10. ProMOS considers foundry services for Elpida as one of its core businesses, Chen noted. (Digitimes)

Technology Headlines – 16 November 2009
Innolux in $5b Chi Mei merger: Taiwan's Innolux Display and Chi Mei Optoelectronics have agreed to merge in a $5.3b transaction that will create the world's third-biggest flat panel maker and a potential challenger to market leaders Samsung and LG Display. Hon Hai Innolux will give one of its shares for every 2.05 shares in Chi Mei. The merger is scheduled to be completed by May 1, 2010 and the new company will keep the Innolux name. Based on the two LCD makers' combined capacity, Innolux should be able to achieve its goal of shipping 4-6m LCD TVs in 2010 (FT, Digitimes)

MediaTek to see Dec rev return to NT$10b, say sources: MediaTek's rev are expected to return to NT$10b (US$310.85m) in Dec, generating revenues of NT$29-30b in the Q4, as order volume has been recovering, according to industry sources. However, the company has reiterated that its previous forecast, saying its Q4 rev will drop 13-19% to NT$27.8-29.8b. China handset makers have recently notified MediaTek to stock up for the Lunar New Year demand beginning in mid-Dec, implying their inventories have been almost consumed, the sources indicated. (Digitimes)

Memory backend suppliers gearing up for DDR3: With customers pushing the DDR3 generation, memory packaging and testing firms Powertech Technology (PTI), Formosa Advanced Technologies Company (FATC) and Walton Advanced Engineering all estimate DDR3 will contribute 90% to their overall DRAM shipments at the end of 2010, up from 40-50% at end-2009, according to company sources. (Digitimes)

Technology Headlines – 17 November 2009

WSTS - Global chip sales may climb 12% in 2010: to $246.9b, versus the previous June forecast of 7.3% growth. WSTS expects semiconductor rev to fall 11.5% to $220.1b this year. Memory-chip sales may rise 18.6% to $50.9b next year, WSTS said. WSTS joins the SIA in forecasting a steeper market recovery next year helped by demand for the devices used in PCs and mobile phones. SIA said earlier this month that it expects chip sales to grow 10.2% in 2010. (Bloomberg)

Gartner revises chip forecasts - sees rev back to 2008 level in 2010: Market research firm Gartner has again raised its 2009 semiconductor sales forecast due to improving market conditions and said it now expects global chip revenue to be $226b this year, down 11.4% y/y. The new projection is a revision from the company's Q3 forecast, which called for revenue to decline 17% y/y. Gartner also upped its forecast for 2010 chip sales, saying it now expects them to grow 13% to reach $255b, roughly the same level as 2008. The most significant changes reflected in Gartner's most recent forecast upgrade came from ASSPs, memory and microprocessors, all of which are benefiting from a strengthening PC market, Gartner said. (EE Times)

Qualcomm in iPhone talks: Qualcomm is in talks to supply products for use in Apple’s iPhone, CEO Paul Jacobs said. “We continue to discuss it, but haven’t made it yet,” Jacobs said in a Bloomberg Television interview in Hong Kong today. “Hopefully, in the future, we will have the opportunity.” (Bloomberg)

Qualcomm to launch TD-SCDMA chipsets in 2010: Qualcomm, the world's biggest chip designer, said on Tuesday that it expects to be selling its TD-SCDMA chips in mainland China within the next year. The company expected to be able to grab much of the market for such chips, Chief Executive Paul Jacobs told reporters during a media event in Hong Kong. (Reuters)

Qualcomm talks to HP, Dell about PC chips: “The PC manufacturers are looking for new growth opportunities, and they are looking for a strategic counter- balance,” said Qualcomm CEO, adding “They see Qualcomm as being a strong supplier that can be a counter-balance to Intel.” Qualcomm is also in discussions to offer its Snapdragon chips to Acer and Toshiba, he confirmed. (Bloomberg)

Intel boosts quarterly cash dividend: Intel raised its quarterly dividend by 12.5% on Monday, citing strong business prospects. Beginning with 1Q10, Intel said it will pay a cash dividend of 15.75c per share, or 63c per share annually. Last week, Intel CFO Stacy Smith told Reuters that the chipmaker was on track to meet its Q4 outlook and that a recovery in corporate spending on PCs could happen in the next 18 months. (Reuters)

Canon to bid for Dutch printer maker Océ: Canon said Monday that it plans to buy Dutch printer maker Océ NV for €730m ($1.09b) in cash, hoping that Océ high-end printing systems will fully complement Canon's midrange products. Canon aims to launch its tender offer of €8.60 a share between Jan and Mar. The bid, which is supported by Océ's management and supervisory board, would be a premium of 70% over Océ's closing share price on Friday and more than double the average closing share price over the past 12 months. Canon CFO said he couldn't quantify the synergies that would be achieved through the integration of Océ. Océ, which employs about 22,000 people, generated €2.9b in rev in 2008, down 6.5% from €3.1b in 2007. (WSJ)

RF Micro says FY2010 free cash flow to top forecast: Chipmaker RF Micro Devices said it completed all previously planned restructuring activities and now expects free cash flow for the current fiscal year to top its prior forecast. The company, which makes chips for mobile phone companies like Nokia and Motorola, had forecast free cash flow of $130m for the full year ending Apr. 3, 2010. RF Micro also expects to be net cash positive in fiscal 2011, it said. Separately, the company said it repurchased $197m of convertible notes due 2010 using cash on hand, and expects to save about $1.9m in interest expense. (Reuters)

NXP to ship sub-dollar Cortex-M0 MCUs through distribution: NXP has said its Cortex-M0 based MCU will be available from distributors in Dec. Cortex-M0 is a 12,000 gate-count core stripped down for low power consumption developed by ARM under the codename Swift. The LPC1100 will target battery applications, e-metering, consumer peripherals, remote sensors, and virtually all 16-bit applications. NXP has claimed that its LPC1100 is the lowest priced 32-bit microcontroller in the market and easier to use than existing 8- and 16-bit MCUs. The recommended pricing in 10,000 piece quantities for 33-pin packaged devices is between $0.65 and $0.95 flash memory sizes of between 8-kbytes and 32-kbytes. (EE Times)

Taiwan Memory - MOEA to resubmit DRAM funding bid, says paper: With a committee of Taiwan lawmakers having rejected a funding bid for the government's plan to restructure the island's DRAM sector, the Ministry of Economic Affairs (MOEA) has said it plans to resubmit the proposal and expects it to pass the legislative body for a vote later in Nov, according to a report from Taiwan's state-run Central News Agency (CNA). (Digitimes)

Asustek in talks with Toshiba to achieve goal of becoming top-3 notebook vendor, says paper: Asustek Computer is considering plans to aid its goal of ranking as the global top-three notebook vendor in 2011 through acquisitions; Toshiba's notebook business has been identified as one of the company's possible targets, according to a Chinese-language Commercial Times report citing Jonney Shih, the company chairman. Although Asustek has already had contact with Toshiba, Shih said results are not yet finalized, the paper added. (Digitimes)

TTM to buy Meadville's PCB business for $521m: PCB maker TTM Technologies agreed to buy Hong Kong's Meadville Holdings's PCB business for about $521m with about $114m in cash and rest in stock to diversify its business, expand into Asia, and create world's No. 3 PCB maker, with combined 2008 annual sales of $1.35b. The combination is expected to add to earnings without synergies within the first year after closing, the company said. The transaction is expected to be completed in the first quarter of 2010, TTM said. The enterprise value of the transaction is about $936m, TTM said. The debt being assumed is in the form of a new fully committed bank facility with a syndicate of seven leading Asian banks, it said. (Reuters)

Technology Headlines – 18 November 2009
Semiconductor industry close to sold out, says SICAS: Chip manufacturing capacity is falling and as demand is increasing the chip industry is becoming close to being sold-out. Manufacturing capacity utilization has climbed above 90% in several leading-edge sectors, according to the Semiconductor International Capacity Statistics (SICAS) organization. Worldwide fab-capacity utilization hit 86.5% in 3Q09, up from 77.0% in 2Q09 and foundry utilization climbed to 91.5% in 3Q09, up from 83.1% in 2Q09. Manufacturing on 300-mm wafers reached 96.1% utilization, up from 91.9% in 2Q09, despite a marked increase in production capacity. Between 80-nm and 60-nm utilisation was 95.7% of capacity and below 60-nm capacity was at 93.5% of capacity in 3Q09. (EE Times)

Infineon takes ARM inside security chips: Infineon and ARM announced a long-term strategic collaboration in the field of security controllers (MCU) for chip card and security applications. Based on the agreement, Infineon will receive an ARMv6M and ARMv7M architecture license. Infineon will become the only ARM partner to have an ARM architecture license specifically for security applications. Infineon aims to have the first products in volume production by 2H11, initially targeting the Multimedia SIM cards mkt. (Reuters, EE Times)

Fears of block sale hit Hynix: Shares in Hynix Semiconductor fell on Tuesday after its main creditor Korea Exchange Bank (KEB) admitted creditors might be forced to divest part of their stake in a block sale on the stock market. “There is a common understanding among creditors of the need to sell shares either by reopening bids or selling part of the stake in the capital markets,” said KEB. Creditors plan to start the procedure for another auction this month but will push for a block sale if no buyer appears. They will meet on Nov 25 to decide details of the sale plan. (FT)

Applied Materials to buy Semitool for $364m: or $11 a share in cash. Semitool makes electrochemical plating and wafer surface preparation equipment used by chip packaging and manufacturing companies. Directors and officers holding 32% of Semtool’s shares have agreed to tender their shares. The deal is expected to close by year end. (TechTrader)

Intel's Otellini worries about PC 'pinch points': CEO Paul Otellini said on Tuesday the semiconductor industry may experience possible "pinch points" in the PC production chain as manufacturers ramp up to meet higher demand next year. He told Intel Capital's CEO Summit that the industry may face a component shortage in the face of a forecasted rise of 12% to 18% unit growth from 2009 to 2010. (Reuters)

MediaTek to ship GSM/GPRS single-chip solution in Dec: MediaTek is scheduled to volume produce its first GSM/GPRS single chips MT6253 in Dec, according to industry sources. The solution will target white-box handsets priced at less than 3,000 Yuan (US$440). Since customers will be able to reduce 40% of procurement costs by using MediaTek's new single-chip solutions, the IC designer expects to see significant shipment growth for MT6253 next year, the sources said. Shipments are expected to reach 10m units in 1Q10 and 100m for the year, the sources noted. (Digitimes)

Market for digital cable STBs chip components declining through 2013, says In-Stat: as a result of reductions in cable operator capex budgets brought on by the global economic recession. In 2008, the total available market (TAM) for digital cable STB semiconductors was over US$2.7b and is expected to decrease in line with an expected 6% decline in global unit shipments of digital cable STBs. The component bill of materials (BOM) for an advanced digital cable STB will fall below US$80 by 2012. In-Stat added that "The transition to MPEG-4, the move toward a hybrid QAM + IP cable STB, and continued integration of personal video recording (PVR) capabilities are creating new technology opportunities for chip competitors.” However, the China market contrasts with the broader cable STB market. Total unit shipments are projected to set another record in 2009, approaching 20m units, the research firm added (Digitimes).

DRAM prices likely to drop in Dec, say module makers: to reflect seasonal demand. The makers have also speculated that Korea-based chipmakers who have already turned profitability are likely to take advantage of their cost competitiveness and slash prices to boost shipments. Korean suppliers now see no need to intervene in DRAM prices, since the Taiwan government is likely to fail in establishing Taiwan Innovation Memory Company (TIMC, previously TMC), the module makers added. (Digitimes)

Toshiba claims EUV photoresist breakthrough for 20-nm era: Toshiba said it has developed a photoresist suitable for use with extreme ultraviolet (EUV) lithography and proved its viability in the world's first 20-nm generation process technology. Toshiba said it would improve the performance of the molecular resist and apply it to chip manufacture. According to the International Technology Roadmap for Semiconductors, high volume production of this generation is expected to start in 2013. (EE Times)

Technology Headlines – 19 November 2009

Infineon Q4 ahead of expectations: Revenues Eur 855m versus consensus Eur 830m (Nom Eur 811m) driven mainly by Industrial & Multimarket (IMM) and Automotive. Segment profit Eur 52m versus consensus of Eur 30m (Nom 29m), also mainly driven by IMM and Automotive. Net income from continuing operations Eur 24m versus consensus Eur 15m. Q1 2010 outlook broadly flat compared to Q409, implying 2% upside on consensus for revenues and approx. Eur 20m upside for segment results. For FY 2010, the company is guiding to top line growth of 10% and a mid single digit segment margin, which is broadly in line with consensus, but ahead of our estimates. (Infineon)

STM unit head sees wireless sector slowdown: "In the wireless the market has started to slow down a little bit," CARMelo Papa, the head of the industrial unit, said at a conference, adding that "Smartphones are growing," but noted prices were falling for other phones, hurting the growth. He said his business - which makes around 1/3 of STM sales - was seeing faster growth for some other products, compensating for the slowdown in the wireless. Papa said the group expects to run its factories to run in 4Q09 at "normal levels" of 85-90%, after cutting the levels to very low during the worst quarters of the economic slowdown. "We are now entering the phase of more normal utilisation levels," Papa said. "There is a good confidence the worst is over." (Reuters)

AMD to redeem up to $1.4b of notes: AMD, riding on a $1.25b payment from Intel, plans to buy back up to $1.4b of debt to improve its risk profile. AMD said on Wed it started a tender offer for up to $1b of 5.75% convertible senior notes due 2012. It also said it would redeem 7.75% senior notes due Dec. 18, 2009, or about $390m of debt. To finance the $1b convertibles buyback, AMD said it would issue $500m of senior notes due 2017 in a private offering, and use the Intel payment. Moody's gave the notes a rating of B2, or a speculative "not prime" rating. AMD reported in its fiscal third quarter that it has just under $3.2b of net debt. In early Nov, CFO Thomas Seifert said he planned to keep about $1b cash on hand for the foreseeable future, using the rest for debt reduction. (Reuters)

Infineon Holders Oppose Wucherer as Chairman, Manager Reports: Four investments funds that hold major stakes in Infineon Technologies AG are opposing the nomination of Klaus Wucherer as the company’s supervisory board chairman, Manager magazine reported, without saying where it obtained the information. (Bloomberg)

MediaTek and Spreadtrum raise wafer starts at foundries for 4Q09: Total orders from MediaTek at TSMC and UMC are likely to increase 15% q/q, buoyed by demand for white-box handsets, according to industry sources in China. MediaTek has offered customers a discount of 10-15% on its MT6225 baseband chips, a move to differentiate its products, the sources indicated. The chip designer has started mass shipments of 65nm-made chips. Rival Spreadtrum Communications is also estimated to grow its wafer-starts at TSMC from 15,000 8-inch equivalent units per month in Q3 to 20,000 in Q4, a 30% rise. Supply of its 6600L and other mainstream solutions has fallen short of demand, encouraging the China-based IC designer to step up its pace of orders at the foundry partner. (Digitimes)

Semtech to buy Sierra Monolithics for $180m in cash: Semtech, which makes analog and mixed-signal chips, said it agreed to acquire Sierra Monolithics for $180m in cash. Sierra Monolithics makes high-performance communications ICs. Semtech will also assume $8m of unvested options, and grant to employees up to $12m in additional equity incentives at closing. Semtech will fund the deal from its existing cash balance. The deal is expected to be accretive to GAAP EPS within 12 months, and immediately accretive to non-GAAP gross margins and EPS. (TechTrader)

Technology Headlines – 20 November 2009
Dell F3Q10 - rev, EPS miss on lower gross margin; sees Q4 rev up q/q: Dell posted F3Q10 (ended Oct 30) rev of $12.9b (+1% q/q, -15% y/y) below cons $13.2b and EPS of 23c vs. cons 28c. Gross margin was 17.3%, worse than the 18.1% expected by the Street. Shipments were flat sequentially and down 5% from a year ago. Operating income was down 43% from a year ago at $577m; net income at $337m was down 54%. Large enterprise revenue was up 4% sequentially and off 23% from a year ago; public sector was down 3% sequentially, and 7% from a year ago; small and medium business was up 5% sequentially, and down 19% year-over-year. Consumer revenue was flat sequentially and down 10% from last year. For Q4, the company sees seasonal improvement in the consumer business, with seasonal weakness in the public sector. Dell sees Q4 rev up from Q3. (TechTrader)

Qualcomm and Mediatek enter into patent arrangement: Qualcomm and Mediatek entered into a broad patent arrangement whereby MediaTek's customers do not receive rights to any of Qualcomm's patents and such customers will need to obtain a separate license from Qualcomm in order to receive rights to any of Qualcomm's patents. Likewise, Qualcomm's customers do not receive rights to any of MediaTek's patents and such customers will need to obtain a separate license from MediaTek in order to receive rights to any of MediaTek's patents. Other terms were not disclosed. (Reuters)

SEMI - North American Oct chip-gear orders rise 3.2% m/m: Orders came in at $756.2m (+3.2% m/m, -10% y/y) and billings were $689.8m (+6.4% m/m) leading to a book-to-bill ratio of 1.10. SEMI reiterated its view of a slowly improving capital spending outlook for the remainder of 2009 and into next year. (Reuters)

SEAJ - Japan chip-gear book-to-bill flat in Oct 2009: Japan-based semiconductor equipment manufacturers posted a book-to-bill ratio of 1.28 in Oct 2009, similar to the prior month's level. The three-month average of worldwide bookings was 66.42b Yen (US$747m) in Oct (+7.9% m/m, +9% y/y). The three-month average of worldwide billings in October totaled 51.91b Yen (+7.7% m/m, -30.7% y/y). (Digitimes)

Altis to join foundry fray, Infineon says: "The plan is to turn Altis into a foundry", said Infineon CEO Peter Bauer in an interview with EE Times. We will guarantee for a certain production volume but additional volume will be generated through Altis' own foundry activities." Infineon as well as JV partner IBM will fit Altis with a set of "good technologies", Bauer said. This refers to embedded flash as well as to future technologies. "They will be equipped very well," he added. Infineon EVP Reinhard Ploss added that the investor has support from French politics. He said he expects the closure of the deal within the next few weeks. "The contract details will be cleared very soon, but we cannot announce anything today", he said. (EE Times)

Toshiba to set up China JV to assemble system chips: Toshiba said it would team up with Nantong Fujitsu Microelectronics, owned 43% by Nantong Huada Microelectronics Group and 29% by Japan's Fujitsu, to set up a JV for system chip assembly in China to help cut costs. Toshiba, which will take an 80% stake in the new venture, declined to give an investment figure or the capacity of the venture. It said Toshiba Semiconductor (Wuxi) would package and test basic system chips, such as those used to control sound and video signals for analog TVs. (Reuters)

Technology Headlines – 23 November 2009
Semiconductor equipment bookings flat, book-to-bill ratio remains above 1.0 SEMI reports that although the book-to-bill ratio for October slipped from September's results, the semiconductor industry continues its slow recovery. Describing bookings as flat, SEMI reported that North America-based manufacturers of semiconductor equipment posted $756.2m in orders in October 2009 and a book-to-bill ratio of 1.10 (September 1.17). “The SEMI book-to-bill number has been above 1.0 for four months now, reflecting small and generally steady increases as the semiconductor industry continues a slow recovery," said Stanley T Myers, president and CEO of SEMI, in a statement (eetimes).

TSMC reiterates no plans to take part in SMIC board or operations TSMC has reiterated that it will not seek representation on the board of directors of SMIC or get involved in the China foundry's operations. TSMC was responding to recent reports from China's media that said the world's top pure-play foundry would take a seat on the SMIC board of directors after obtaining a major stake in the China competitor in line with a lawsuit settlement (digitimes).

DDR3 to be mainstream in 2Q10, says iSuppli DDR3 shipments will rise to account for more than half of the global DRAM market by the second quarter of 2010, surpassing DDR2 for the first time as the leading technology for PC main memory, according to iSuppli. DDR3's share of the DRAM market in terms of gigabit-equivalent shipments will rise to 50.9% in the second quarter of 2010, compared to 14.2% in second-quarter 2009 and just 1% in second-quarter 2008. "DDR3 is 50% faster than today's dominant DRAM technology, DDR2, while using about 30% less power," said Mike Howard, senior DRAM analyst for iSuppli. "For PC users across the board, this means faster performance. For notebook users, it can result in longer battery life." (digitimes)

Major price cuts for e-book readers unlikely in 2010, says PVI chairman Prices of e-book readers are unlikely to drop sharply to as low as US$100 in 2010, as the market has just started to take off, and there is little need for vendors to resort to price reductions to enhance competitiveness, said Scott Liu, chairman of electrophoretic display (EPD) maker Prime View International (PVI). Some market analysts have remarked that the price of e-book readers have to drop to US$100 in order for the market to truly take off. But the PVI chairman noted that although the costs of EPD panels are dropping, growth for the market is still strong enough to deter major pricing campaigns by device vendors (digitimes).

Elpida develops 1Gb GDDR5; to start mass production in 2Q10 Elpida has announced that it completed development of a 1Gb GDDR5 that operates at a speed of six gigabits per second (Gbps). The new graphic memory (GDDR: graphics double data rate) device marks Elpida's entry into the GDDR market. Elpida said sample shipments of its first GDDR product will start in December, with mass production slated for the second quarter of 2010. Applications for GDDR memory devices used with GPU are found not only in such graphic processing equipment as game consoles and PC graphics cards but also in equipment that require high-performance computing for use in such areas as science and technology (digitimes).


Technology Headlines – 24 November 2009
HP FY Q4 Results, Q1 Outlook In Line With Guidance Hewlett-Packard reported Q4 results in line with the pre-announcement the company provided on November 11. For the quarter, the company posted revenue of $30.8bn and non-GAAP EPS of $1.14, as HP previously said. Revenue was down 8% year-over-year, or 5% on a constant currency basis. EPS was actually up from $1.03 a year ago, thanks to a spike in operating margin to 11.8% from 10.1%, as the company tightened down on costs. Full year revenue was $114.6 bn, down 3%, or up 1% in constant currency. Revenues in the quarter were down 3% in the America, 17% in EMEA and 1% in Asia Pacific. For Q1, the company repeated its forecast of revenue of $29.6 - $29.9bn, with non-GAAP EPS of $1.03-$1.05. HP sees revenue for the full year ending October 2010 of $118-119bn, and non-GAAP EPS of $4.25 to $4.35. While the release suggested that this is an increase in guidance, these are the same numbers the company provided when it announced the 3Com deal on November 11 (techtrader).

Analog Devices FY Q4 Revs, EPS Top Ests Analog Devices posted better-than-expected Q4 results. Revenue was $572m, down 13% from a year ago, but up 16% sequentially, and ahead of the Street at $523.8m. EPS of 36 cents beat the Street by a dime. For FY Q1 ending in January, the analog chip company sees revenues sequentially flat, which would be above the Street at $532.5m. ADI sees EPS for the quarter of 36-37 cents, ahead of the Street consensus at 28 cents. The company said it expects automotive and communications sales to be flat sequentially, consumer sales down from Q1. The company expects gross margin for Q1 of 58%-58.5%, up from 56.3% in Q4. The company had posted gross margin of 54.1% in the third quarter, and 61.1% in the year-ago fourth quarter (tech trader).

IC rankings: Samsung among few set to grow in '09 Samsung Electronics Co. Ltd. is the only top 10 semiconductor supplier expected to show an increase in chip sales this year compared to 2008, according to preliminary 2009 semiconductor supplier rankings released Monday (Nov. 23) by market research firm iSuppli Corp. Of the 135 semiconductor suppliers tracked by iSuppli (El Segundo, Calif.), only 27 are expected to show year-to-year growth, according to the firm. ISuppli also further revised its semiconductor industry revenue projection for 2009, predicting that industry revenue would be down 12.4 percent compared to 2008. Beyond the top 10, fabless semiconductor supplier MediaTek is expected to post the best performance among the world's 20 largest chipmakers, with an expected increase of 21.7 percent, iSuppli said. The company capitalized on the strong growth of China's cell phone market with its line of mobile handset baseband chips, according to the firm (eetimes).

Technology Headlines – 25 November 2009
Challenges ahead for pure-play foundries despite strong on-year growth in 4Q09, says iSuppli "The reality is that Q4 is bringing only a moderate expansion in revenues compared to Q3. Furthermore, foundries are noting a slowing of orders, indicating an underlying uncertainty in the market." Global semiconductor foundry revenues in the Q4 is set to rise by a comparatively mild 6% compared to Q3, according to iSuppli. Foundries are reporting weakness in their sales of semiconductor to the communications and computing segments, with the exception of netbook PCs, an area that is seeing some strength, said iSuppli. The companies also note healthy orders in the consumer segment. Foundries also are reporting downward pricing pressure at advanced semiconductor manufacturing process nodes, such as 65nm, as more suppliers enter this segment of the market, iSuppli indicated (digitimes).

PC shipments to finish 2009 growing 3% Despite the recession, global PC shipments will end the year growing nearly 3%, but revenue from those shipments will decline 11%, according to researcher Gartner. In 2010, PC shipments will increase 12.6% to 336.6m units. Revenue will increase 2.6% to $222.9bn in 2010, says Gartner.Gartner says Windows 7, will have a little impact on holiday PC sales, but noted that 2010 PC shipments could be affected (purchasing.com).

Compal Q4 outlook Compal Electronics, the world's No.2 contract laptop maker, expects fourth-quarter personal computer shipments to climb more than previously expected, its CFO said, pushing its shares up 2% in early trade. Compal expected PC shipments to climb 20% in the fourth quarter from the preceding three months, up from its previous forecast of 10%, Chief Financial Officer Gary Lu said. (Reuters)

Technology Headlines – 26 November 2009
Samsung denies planning a bid for Infineon: Samsung Electronics said market speculation that it may bid for German chipmaker Infineon was untrue according to a report from Reuters in Seoul. “We have never studied the possibility," Reuters quoted Samsung spokesman James Chung as saying. (EE Times)

ARM confident in hitting $460m in revs but not expectations of $500m: ARM Holdings remains confident in achieving annual revenue of at least $460 million this year but is "less confident" in meeting recent analysts' expectations calling for revenue of around $500 million. "Obviously the higher those numbers go the less confident we are about hitting it," President Tudor Brown told Dow Jones Newswires in an interview Wednesday. But he said he doesn't believe analysts "have all overshot." Brown also said that ARM's conversations with its clients including semiconductor manufacturers indicate they see strong chip demand in the first half of next year, but he personally is cautious on the outlook for demand in the second half of 2010 due to uncertainties in consumer spending. (WSJ)

IFX LTE RF collaboration with Nokia Infineon and Nokia have said they are going to cooperate on the development of RF transceivers for use in LTE. The work could lead to systems which can deliver 1-Gbit per second data transfer rates. The agreement covers a non-exclusive collaboration to make sure Nokia's baseband modem technologies work with Infineon's RF ICs. As Nokia is prepared to license out its modem designs the collaboration will give the electronics industry access to complete modem solutions for HSPA (High Speed Packet Access) through LTE (Long Term Evolution), Infineon said (eetimes).

EUV Lithography Stakeholders Chip Away at Mask Infrastructure Problem The availability of defect-free masks and a lack of funding for an infrastructure that can inspect those masks, is the most critical issue faced today by EUV lithography development. But working groups are making progress defining — and funding — the solution. Although work still needs to be done to make EUV lithography sources ready for high-volume manufacturing, they are no longer the top critical concern for EUVL readiness, according to the latest steering committee list to come out of last month's EUV Lithography Symposium in Prague, Czech Republic (Semiconductor International).

NAND flash contract prices trend down in 2H November Contract prices for mainstream multi-level cell (MLC) NAND flash memory chips have come down 2-4% for the latter part of November, reflecting a seasonal demand drop, according to DRAMeXchange figures. DRAMeXchange said major chip suppliers are expected to ramp high-density chips using 30nm-class nodes in December. With supply likely to grow, NAND flash price correction may continue in the contract market through the end of 2009, the research firm estimated (digitimes).

Chungbuk Technopark Chooses ARM Cortex-M0 Processor SoC R&D Center in Chungbuk Technopark (CBTP) a non-profit local government foundation in Chungbuk Province, today announced that they have licensed the ARM Cortex-M0 processor. The licensing agreement will enable CBTP to accelerate innovation based on the Cortex-M0 processor for Korean start-up companies, and fabless companies currently designing MCUs based on 8- or 16-bit architectures (ARM).

ARM, Chartered, IBM, Samsung, and Synopsys Collaborate to Deliver Vertically Optimized Solution for 32/28nm Mobile SoC Designs In a move that addresses fundamental challenges in creating advanced SoCs, ARM today announced at the Design Automation Conference (DAC) an agreement to develop a comprehensive technology enablement solution for the design and manufacture of mobile Internet-optimized devices. The objective of this collaboration is to leverage innovations in material science, mobile multimedia implementation and SoC design to lower risk and improve time-to-market for advanced mobile products (ARM).

32-bit processor pushes deeper into 8-bit territory NXP’s 50-MHz ARM Cortex-M0-based LPC1100 microcontroller family represents the latest 32-bit challenge to 8- and 16-bit processors. The parts are available now with prices starting at 65 to 95 cents (10,000). The company claims that the EEMBC (Embedded Microprocessor Benchmark Consortium) CoreMark Benchmark measures 40 to 50% better code density for the LPC1100 than that of 8- and 16-bit microcontrollers. The 32-bit device’s improved code density may signal another round of refinement of the 8-bit-processing sweet spot; however, it may also reflect a 16- or 32-bit bias in the benchmark code (eetimes).

STM uses Omron MEMS microphone in multi-die package STM has started selling MEMS microphones that use sensor technology from Omron Corp. and has asserted that this will improve the sound quality, reliability, and cost-effectiveness for voice applications in cell phones, wireless devices and games. Samples of digital MEMS microphones that integrate ST's electronic control circuit and Omron's micro-machined sensor in a single package will be available before the end of 2009, at less than one dollar for large-volume orders. MEMS microphones offer additional features such as noise suppression and directionality, useful to determine and filter out noise. Superior performance can be gained by deploying multiple MEMS microphones in one device. Such microphone arrays improve noise cancellation (STM).

Apple takes 47% revenue share of US desktop market: In October, Mac US retail desktop computer revenue share was 47.71, percent up from 33.44 percent a year earlier, according to NPD. Stephen Baker, NPD's vice president of industry analysis, attributes some of Apple's October gains to the release of fast, new iMacs during the same month that Windows PC sales declined ahead of Windows 7's October 22nd launch. "You only really had 10 days to catch up some 20 days of lost [Windows PC] sales," Baker said. (Betanews)


Technology Headlines – 27 November 2009
Samsung supplies of memory chips sufficient, say distributors Supreme Electronics, a Taiwan-based memory distributor for Samsung, has remarked that supplies of DRAM and NAND from Samsung became sufficient recently. Yosun Industrial, the other Taiwan-based distributor for Samsung memory, has also estimated revenues for November to grow sequentially. Downstream device makers and distributors saw limited NAND flash from Samsung over the previous 2 months, as the vendor gave Apple orders top priority. However, the tight supply has eased, mainly because iPhone sales in China are not as good as those in other countries. As for DRAM chips, Samsung has also increased its chip supply to downstream customers, the sources indicated (digitimes).

Texas Instruments spin-off files for $500 million IPO Sensata Technologies Holding BV, a vendor of sensors and controls used in the automotive and aerospace industries, has filed for an IPO that would raise $500 million. Sensata operated as a part of Texas Instruments until 2006 when it was acquired by Bain Capital. The company expanded through the acquisition of First Technology Automotive and Special Products in December 2006 and the acquisition of Airpax Holdings Inc. in July 2007. The prospectus points out that Sensata has $2.4 billion of debt (eetimes).

Component makers remain conservative about 1Q10 performance Component makers remain conservative about shipment performance in Q1/2010 despite notebook makers such as Quanta and Compal having both estimated better shipments than their previous forecasts. The component makers pointed out that current order visibility is only about a month, while some vendors are still digesting their inventories after seeing lower demand in Sept./Oct.. Although the component makers still believe Microsoft's Windows 7 will help boost PC demand in the Q1 2010, they remain cautious since strong market demand for the year-end holidays has not yet emerged (digitimes).

Infineon outlook & acquisitions Infineon CEO Bauer and CFO Schroeter said in an interview with Handelsblatt the company is optimistic for its sector for the coming 3 to 4 years and the own position might be strengthened by acquisitions. (Handelsblatt)

Renesas samples 45-nm ARM-based mobile apps processor Renesas Technology Europe has begun sampling the SH-Mobile APE4, a Cortex-A8 based application processor targeted at mobile phone and mobile device implementations. The processor is implemented in a 45-nm process and can be operated at a clock frequency in excess of 1-GHz, Renesas said. It includes the ability to process 1080 progressive-scan high-definition video recording and playback at 30 frames per second. To support 3-D graphics the device is equipped with a PowerVR SGX2 graphics engine, licensed from Imagination Technologies (eetimes).

Technology Headlines – 30 November 2009
Acer considering new acquisition for PC business, maybe Japan-based vendor, says chairman: Acer chairman JT Wang recently revealed that the company is currently thinking of a new acquisition to strengthen its PC business and is in talks with several vendors, in particular Japan-based brands which have other core businesses beyond PC products. Since the acquisition of Gateway, eMachines and Packard Bell has already helped Acer to build its economies of scale and increase global market share, the new acquisition would instead focus on gaining technologies or marketing, Wang said. In 3Q09, the top-five notebook vendors in Japan were Japan-based NEC, Fujitsu and Toshiba, US-based Dell and Japan-based Sony, while Taiwan's Acer ranked sixth. (Digitimes)

Infineon Investors Want Ex-Porsche CEO as Chairman: Several large shareholders of Infineon Technologies AG support appointing former Porsche SE CEO Wendelin Wiedeking as the chairman of the company’s supervisory board, Focus reported. Wiedeking is hesitant to accept, the German magazine said in an e-mailed preview of its report, without saying where it got the information. (Bloomberg)

Taiwan DRAM restructuring hits dead end: Taiwan's legislative economics committee on Nov 26 voted unanimously against the Ministry of Economic Affairs' (MOEA's) request for funds to invest in Taiwan Innovative Memory Company (TIMC). This marks the fourth in total and second major, legislative defeat for the government's efforts to restructure the island's DRAM industry. Plans to found TIMC (previously Taiwan Memory Company, TMC) with technological backing from Japan's Elpida Memory have generated criticism that the government is creating a competitor to Taiwan's already struggling DRAM players. (Digitimes)

TSMC prepares to make automotive ICs in China TSMC plans to launch what it says will be the automotive industry's first process qualification specification and service package for automotive-grade semiconductor manufacturing in China. The company also announced that its Fab 10, located in Shanghai, is prepared to manufacture automotive grade ICs. The automotive process qualification specification was first proposed at the Automotive Electronic Council's (AEC) annual Reliability Workshop in June 2008 (EE Times).

Dell expected to see its gap against Acer widen to 10pp in 4Q09: Dell is expected to see its share in the global notebook market continue to decline in 4Q09 and its gap against rival Acer widen to over 10pp as demand for enterprise notebooks normally slows down in the final quarter of each year, while Acer is boosting sales with the launch of sub-US$200 netbooks, according to industry sources citing figures from IDC. In addition to competition from Lenovo in China's enterprise notebook market, Acer and Samsung Electronics' strong enterprise notebook shipments are also major reasons for Dell's unsatisfactory shipment performance in the segment, the sources noted. (Digitimes)

Technology Headlines – 01 December 2009
SIA - Global chip sales rise 5% m/m in Oct: to touch $21.7b (-3.5% y/y), spurred by strength across all regions as electronic equipment manufacturers boost production for the holiday season. "Inventory management throughout the supply chain has been very tight, and this may extend the fourth-quarter build season by a few weeks," SIA added. (Reuters)

Worldwide sales of new semiconductor equipment may reach $16b this year: according to industry researcher SEMI (Bloomberg)

Broadcom to acquire Dune Networks for $178m: Chipmaker Broadcom said on Monday it agreed to buy privately held Dune Networks for around $178m in cash in a move to bolster its portfolio of network equipment products. Broadcom said it expects the deal to be neutral to slightly accretive to EPS in 2010, excluding certain items. Martin Lund, GM of Broadcom's network switching business, noted that Dune's technology is well suited to meet the requirements of large-scale cloud computing networks. The deal is expected to close by the end of March. (Reuters)

Altera boosts Q4 rev view: Altera said it now sees Q4 sales up 15%-18% q/q, above its previous forecast of 6%-10% q/q growth. “The company expects all four of its vertical markets to be up sequentially in the fourth quarter reflecting a strong new product cycle as well as improving end market trends and customer desire for appropriate inventory to support sales levels,” Altera said in a statement. “Sales to wireline and wireless telecommunications equipment manufacturers will likely be the largest contributor to fourth quarter growth as demand for Chinese and Indian deployments have continued to improve.” (TechTrader)

Numonyx sees return to profit in coming qtrs: STM-Intel memory JV Numonyx came close to breaking even in Q3, CEO Brian Harrison told Reuters. "We expect to be profitable in the coming quarters, but we're not making any predictions," he said. "We're in a good position. We have lowered our cost base substantially." The downturn played to the benefit of Numonyx, which specializes in cellphone memory, as its chief rival Spansion slumped into bankruptcy. "As we look to 2010, we will more than double our spending to grow our capacity," Harrison said. "We expect that the overall memory market will grow about 9-10% for handsets. We think we'll grow at more than double the rate of the market, so I think we'll grow in the greater-than-20% range." Harrison said Numonyx became the global leader in NOR in Q2 and was expecting to have about a third of the market in Q3. "In the fourth quarter we are reaching full and complete independence from our parent companies," he concluded, without commenting on the company's timeline for a potential IPO. (Reuters)

Online Holiday Shopping To Date Up 3% From A Year Ago Online shopping for the first 27 days of this year’s holiday season totalled $10.57bn , according to ComScore, up 3% from the comparable period last year. Black Friday sales online were $595m, up 11% from a year ago. Sales on Thanksgiving Day were up 10% from last year (TechTrader).

Qualcomm pressured in high-end handset chip market, in talks with Apple say mkt sources: Qualcomm is in talks with Apple for interest in future cooperation, according to market sources. Qualcomm is supplying handset chips to Korea-based Samsung Electronics and LG Electronics and HTC. However, none of the most popular smartphones – iPhone, Blackberry and Palm Pre –adopt Qualcomm's 3G solutions. On the other hand, Motorola has a tight relationship with Freescale, while Nokia and Sony Ericsson are more likely to give ST-Ericsson priority on their supplier lists, the sources indicated. In addition, Korea-based handset vendors have been promoting low-cost smartphones, meaning they tend to adopt more low-priced chipset solutions instead of more expensive chips from Qualcomm. (Digitimes)

Nokia sues LCD makers: Nokia sued Samsung Electronics, LG Display, AU Optronics and other manufacturers of liquid-crystal displays over claims they colluded to fix prices of panels. The lawsuit, filed Nov. 25 in federal court in San Francisco, is based on federal and state antitrust claims. It mirrors arguments AT&T Inc. made in a suit filed last month in the same court against liquid crystal display manufacturers. (Bloomberg)

Apple accused of driving down flash prices: the Korea Times is reporting that memory chip providers are complaining that Apple is pushing down flash prices by buying fewer chips than it actually orders from Korean chip companies Samsung and Hynix. (TechTrader)

OmniVision F2Q10 - rev, EPS beat; Q3 rev outlook disappoints: For FY Q2 ended in Oct, the manufacturer of digital image sensors posted revenue of $183.3m, up from $163.9m a year ago and $105.6m in Q1, and above the Street at $163.9m. Non-GAAP EPS of 27c was well ahead of the Street at 16c. However, it expects Q3 rev of $145-160m, below cons $168.6m. OmniVision sees non-GAAP EPS of 14-24c vs. cons 20c. (TechTrader)

GPS chip makers eyeing notebook market GPS IC makers will expand their territory in the notebook market as Windows 7 enables built-in GPS platform, according to IC distributors in Taiwan. Microsoft has recently ordered 1,000 flash drives with built-in GPS chips from Switzerland-based U-blox AG to support software makers develop GPS chip application software, the sources indicated. U-blox has been cooperating with several Taiwan-based IC distributors to develop Windows 7-platform GPS modules to be built into notebooks, according to U-blox Taiwan country manager Ming Chiang. The market for GPS-integrated notebooks will take off in 2010 (Digitimes).

Obducat's CEO resigns amid losses Patrik Lundstrom, chief executive of Obducat, has announced his intention to leave the nano-imprint lithography supplier (EE Times).

Technology Headlines – 02 December 2009
SEMI - No new fabs expected in 2010: Capital spending is expected to increase by 66% in 2010, but plans for new fabs will remain on hold for next year, according to SEMI. "Companies show more interest in investing in equipment used for technology upgrades." 2009 capex is expected to hit $15.5b (-49.5% y/y) before rebounding 65.9% in 2010 to $25.7b. The largest six spenders in 2010 -- dubbed "The Fantastic Six" -- are Samsung, Intel, TSMC, Flash Alliance, GlobalFoundries, and Inotera. Worldwide sales of new semiconductor equipment in 2009 will total $16.0b (-46% y/y), but grow by 53% y/y to $24.5b in 2010 and by a further 28% in 2011 to $31.2b. (EE Times)

Samsung ramps 30nm-class NAND flash production: Samsung Electronics has announced volume production of 3-bit, multi-level-cell (MLC) NAND flash chips using 30nm-class process technology began at the end of Nov. The chips will be used in NAND flash modules accompanied by exclusive Samsung 3-bit NAND controllers to initially produce 8GB microSD cards. Three-bit MLC NAND increases the efficiency of NAND data storage by 50% over today's pervasive 2-bit MLC NAND chips, according to Samsung. Citing Gartner Dataquest, Samsung said the global NAND flash memory market is forecast to be worth US$13.8b in 2009 and reach US$23.6b by 2012. (Digitimes)

AMD issued $500m senior notes: In an 8-K filing, AMD said it issued $500m aggregate principal amount of 8.125% senior notes due 2017 on Nov 30. (Reuters)

Technology Headlines – 03 December 2009
ST-Ericsson additional restructuring plan: ST-Ericsson announced an additional restructuring plan targeting additional annualized savings of $115m from reductions in operating expenses, an R&D efficiency program and a global workforce review for 600 employees worldwide (STM).

ASML and Brion extend partnership with STM for Integrated Lithography: ASML, along with its subsidiary Brion Technologies, today announced a broad-scoped joint development project with STMicroelectronics (STM) to accelerate 28-nm node deployment and 22-nm node development. This joint development project, code-named SOLID (Silicon printing Optimization with Lithography control and Integrated Design), seeks to optimize the patterning process from design to manufacturing, extend characterization tools and methods to develop new correction/compensation techniques for reducing variability and explore breakthrough lithography solutions for manufacturing complex chips at sub-30-nm nodes. (ASML)

ARM CEO says Intel unlikely to win major share of phone mkt: “I’m sure that Intel are going to get their Atom designed into a few handsets, it’s an inevitability,” ARM CEO Warren East said yesterday, adding that too many device manufacturers have invested in ARM technology used by chipmakers such as Qualcomm, TI and STM for them to be persuaded by Intel. In the same way, the attempts of Qualcomm and other chipmakers to get ARM designs into computers will likely fail to unseat Intel’s hold on that mkt, he said. “I don’t think ARM is going to take over the PC world from Intel, and I don’t think Intel is going to take the smart-phone world from ARM,” he said. The two chip designs are more likely to compete directly for orders from makers of other devices, such as TVs and cars, as they add internet connections to their products, East said. (Bloomberg)

Tokyo Electron orders to top forecast, Chairman Says: Tokyo Electron, the world’s second-largest maker of chip-manufacturing equipment, expects orders this quarter to exceed the company’s forecast, helped by demand from memory chipmakers, Chairman Tetsuro Higashi said. Bookings for chip and flat-panel gear in the three months ending Dec 31 will be close to the 105b yen ($1.2b), 12% higher than the 93.8b yen predicted by the company in Oct. The rebound may help Tokyo Electron, facing its first annual loss in seven years, turn profitable next quarter, Higashi said. “The recovery is widespread and includes makers in Taiwan, South Korea and Japan,” Higashi said, adding that the demand in the industry will continue to grow for the next two years and that the recovery is prompting Tokyo Electron to revive its plans to build a new 30b yen facility. (Bloomberg)

Motorola adopts MediaTek chips; Samsung considering, say sources: MediaTek has started shipping chips to Taiwan OEMs making handsets for Motorola, while Samsung Electronics is considering adopting the designer's GSM/GPRS single-chip solution MT6253 to replace Infineon's single chips, according to industry sources. As major international handset chip suppliers are shifting their focus to the 3G market, MediaTek has been gifted with more opportunities of entering the global supply chain with its 2.5G/2.75G solutions, the sources indicated. MediaTek is also a supplier of LG Electronics (LGE), the source said. (Digitimes)

Synopsys tumbles - FY Q4 solid but outlook disappoints: EDA software firm Synopsys posted revenue for its fiscal fourth quarter ended Oct 31 of $338.3m, a hair below cons $339.4m; non-GAAP EPS of 33c beat cons 32c. For FY Q1 ending in January, the company sees rev of $325-333m which would be down sequentially; the mid-point of the range is below cons $332.8m. It sees F1Q10 non-GAAP EPS of 38-40c, below cons 41c. For FY2010, Synopsys sees rev of $1.33-1.35b, down from the $1.36b reported for FY2009, and below cons at $1.37b. The company expects non-GAAP EPS for the full year of $1.52-$1.62, below cons $1.68. (TechTrader)

Intel’s dispute With Nvidia said to be a focus of FTC review: Intel’s legal dispute with graphics-chip maker Nvidia Corp. is being reviewed as part of an antitrust probe of Intel by the U.S. FTC, according to people familiar with the matter. The FTC is trying to determine whether a lawsuit filed by Intel earlier this year is an effort to disrupt Nvidia’s business, one person said. The investigation of Intel, started in 2008, is continuing even though the company settled its antitrust fight with AMD in Nov. The FTC inquiry goes beyond issues raised in the clash with AMD, which accused Intel of pressuring computer makers into exclusive agreements, said Thomas McCoy, AMD’s EVP for legal affairs. (Bloomberg)

Richtek Seeks to Block Imports of AMD Graphics Cards: Taiwanese IC designer firm Richtek Technology filed a U.S. trade complaint claiming AMD’s graphic cards are made with power management technology stolen by a rival. Richtek claims Upi Semiconductor infringed its patents and stole trade secrets, and then incorporated that information into power management components for use in AMD graphics cards. In a complaint filed today with the U.S. ITC in Washington, Richtek seeks to block U.S. imports of AMD’s Radeon HD cards made in China. A spokesman for AMD, said the company is reviewing the complaint, and declined to comment further. (Bloomberg)

Micron to Enter Hard Drive Market, Take on Intel: Memory firm Micron Technology is entering the market for computer storage drives based on flash chips, taking on larger rivals Intel and Samsung Electronics. Micron plans to offer two solid-state drives (SSDs) in 1Q10. The drives will be the fastest in the industry, claims the company, because they use a new controller chip that Micron developed with Marvell Technology. Micron has a JV with Intel, to manufacture flash memory. They don’t share software and controller technology. (Bloomberg)

Handset panel makers respond to Nokia lawsuit saying price fixing not easy: Commenting on Nokia's price-fixing lawsuit against LCD panel makers, sources with Taiwan's panel sector have noted that it is not be easy for suppliers to jointly control prices as there are so many competitors and different technologies in the small- to medium-size LCD market. (Digitimes)

Samsung files trade complaint against Sharp over LCDs: Samsung Electronics, fighting an order that may limit sales of its LCD TVs in the U.S., filed a new trade complaint against Sharp over LCD devices. Samsung and Sharp have been fighting for two years, with each accusing the other of infringing patents on the LCD technology and seeking to block the disputed products from the U.S. mkt. Last month, the ITC said certain LCD-TVs and computer monitors made by Samsung that infringe Sharp patents should be banned from the U.S. That decision is being reviewed by President Barack Obama. Samsung has said it will be able to work around the Sharp patents to ensure the ban doesn’t interfere with its sales. (Bloomberg)

Technology Headlines – 04 December 2009
Marvell F3Q10 - rev, EPS tops ests; robust Q4 outlook: Diversified chipmaker Marvell posted F3Q09 (ended Oct 31) rev of $803.1m (+2% y/y) vs. cons $777m driven by strong demand for its storage, mobile and networking chips, and non-GAAP EPS of 35c vs. cons 27c. Non-GAAP gross margin in the quarter was 57.8% (+250bps q/q, +550bps y/y) thanks to better product-mix and cost cuts. Marvell forecast F4Q09 rev of $850m vs. cons $779.6m and adj. EPS of 33c-39c vs. cons 27c. Its CEO said that the disk drive industry is benefiting from continued low PC prices (Marvell chips are found in disk drives from Western Digital) while its CFO added that the company's mobile business has the greatest growth potential (Marvell chips are used in BlackBerry while a half dozen handset makers including Dell are currently building smartphones based on Marvell's low-cost OPhone platform). (Reuters, TechTrader)

TSMC 2010 Capex to Be ‘Much Higher’ Than $2.7b: TSMC expects 2010 capital spending to be much higher than $2.7b, Morris Chang, chairman and CEO, said today at the company’s suppliers’ forum in Hsinchu, Taiwan. The chipmaker in October raised its spending budget for factories and equipment this year to $2.7b from a July 30 estimate of $2.3b. The company spent $1.9b last year. Spending in 2010 will rise from this year, Chang said at the time, without providing a figure. (Bloomberg)

Avago F4Q09 - rev, EPS beat; Q1 rev flat to down 3%: Analog chipmaker Avago posted F4Q09 (ended Nov 1) rev of $428m, ahead of cons $417.8m. Non-GAAP EPS of 29c beat cons 28c. For F1Q10, it sees rev flat to down 3%, with non-GAAP gross margin of 44.5%, plus or minus a point; that compares to 44.9% in Q4. (TechTrader)

Sony CEO calls for more streamlining: Saying Sony has to make its own destiny, CEO Howard Stringer said the electronics giant must blunt the strong yen's impact by continued streamlining even after it completes its current restructuring plan. He also said initial holiday-season sales were brisk for the PlayStation 3 game console, LCD televisions and Vaio computers, but he cautioned that it was too early to judge whether that demand is sustainable. Sony expects to lose money again this year with a net loss forecast of 95b yen in the fiscal year ending Mar 31, 2010. It has based those full-year estimates on a foreign-exchange rate of 90 yen to the dollar. (WSJ)

Cortex-M0 is fastest ARM sign-up: The Cortex-M0 which has just become the fastest licensed ARM core in history. The core which offers 32-bit performance in the footprint of a 16-bit processor, has been licensed by 15 companies since its launch in February this year. According to Dominic Pajak, product manager of the ARM Cortex-M0, almost half of the licensees are new to ARM. Of the 15 only five have so far been named: NXP, Triad Semiconductor, Melfas, Austriamicrosystems and the latest sign-up Chungbuk Technopark. Pajak said that there are more companies in the pipeline to sign licenses can some could be confirmed before the end of the year. NXP was lead partner on the development of Cortex-M0. (EE Times)

Mentor Graphics F3Q10 - rev, EPS beat; Q4 outlook light: EDA software firm Mentor Graphics reported F3Q10 rev (ended Oct 31) of $189.2m, ahead of cons $183.5m, with non-GAAP EPS of 5c vs. cons 1c. For F4Q10, it sees rev of $230m vs. cons $234.2m, with non-GAAP EPS of 28c vs. cons 32c. (TechTrader)

Acer rises in iSuppli rankings amid PC rebound: iSuppli said Thu (Dec. 3) it revised its 2009 PC sales forecast thanks to better-than-expected third quarter shipments. The firm also said Acer moved into the No. 2 position in global PC sales in 3Q09, marking the first time an Asian OEM has ranked so highly in PC market share for a quarter. 3Q09 PC shipments rose 1.1% y/y and 19% q/q to 79.8m units, according to iSuppli. iSuppli revised its 2009 PC unit shipment forecast to a 0.9% decline (vs. prev 4% decline). (EE Times)

External Disk Storage market numbers improving, Gartner Says: Gartner reports that worldwide external disk storage revenue totaled more than $3.9b in 3Q09 (-7.3% y/y). But that's much better than double-digit declines of 11.1% in Q1, and 15.7% in Q2. "We have high hopes that this slowing decline will continue in Q4 and turn around [to positive numbers] by mid-2010. That's what we're projecting right now," it added. (eWeek)

Technology Headlines – 07 December 2009
Intel scraps graphics chip based on Larrabee: Intel has scrapped plans to launch an advanced graphics chip based on its novel Larrabee design, after concluding that delays in the project would make it uncompetitive, a spokesman said on Sunday. Intel decided to scrap plans for the graphics card because Larrabee's silicon and software development are behind where it had hoped they would be at this point in the project, spokesman Nick Knupffer said. The company was planning to launch the graphics card in the 2009-2010 timeframe, he said. Intel now plans its first Larrabee product to be used as a software development platform for both graphic and high performance computing, Knupffer said. Knupffer added that Intel will reveal more of its graphics plans next year. (Reuters)

Nanya Technology gets investment from parents: Formosa Chemicals & Fibre, an affiliate of Formosa Plastics Group, invested an additional NT$781m in Nanya Technology by paying NT$20 a share for 39.1m shares. Bloomberg also added that Nanya Plastics brought NT$3.87b of Nanya Tech shares. (Bloomberg)

Qualcomm and ARM invest in interconnect IP solutions provider: Arteris, a interconnect IP solutions provider, announced today that it has raised the first tranche of a strategic investment round totalling $9.7m from a group of investors led by Qualcomm and including ARM. Keith Clarke, General Manager, Fabric IP, ARM said “We will work with Arteris to ensure that ARM® silicon partners have access to the broadest range of AMBA and multi-standard interconnect solutions. Our goal is to have the Arteris technology interoperate with AMBA protocol-based IP and so accelerate deployment of ARM processors in SoC designs.” (Bloomberg)

Court orders Apple to pay Opti $22m: A U.S. federal court has ordered Apple Inc. to pay $21.7m in royalties and interest to chip technology licensor Opti for unintentionally infringing one of Opti's patents, related to the company's U.S. patents covering "pre-snoop" technology. The court also ruled that there was no wilful infringement in the case and denied the reimbursement of attorney fees. (EE Times)


Technology Headlines – 04 January 2010 (all the news over the holidays from Dec 21)
Infineon lifts quarterly outlook on higher demand; eyes margin improvement: Infineon said on Dec 22 that it now expects high single-digit sales growth in the three months through Dec (F1Q10) compared to F4Q09 on improved sales in the automotive and industrial units, and an operating profit margin in the high-single digit percentage range. In the previous outlook for F1Q10, Infineon had seen revenues and the combined segment result to be about on the same level as in F4Q09. Meanwhile, Munich-based magazine Focus reported that Infineon is targeting an operating profit margin of more than 10% “as quickly as possible”, citing an interview with CFO Marco Schroeter. The report added that the CFO is particularly “unhappy” with the profit margin from the company’s mobile business and is working to improve this. Measures include outsourcing more production and improving research, the magazine said. (Reuters)

Broadcom to pay $160.5m in Investor Suit: Broadcom said Dec 29 it will pay $160.5m to settle investor claims related to the semiconductor maker's accounting for stock options. The company agreed to settle the securities litigation pending against it and some of its current and former officers and directors. The class-action suit was brought by investors who acquired Broadcom shares between July 21, 2005, and July 13, 2006. Broadcom said it expects to record a settlement charge in the fourth quarter and to continue to incur legal expenses for remaining stock-option matters. (WSJ)

TSMC surpasses 2009 capex estimate: In 39 separate transactions between Dec 2 and Dec 28, TSMC bought tools from 15 different vendors, totalling $1.24b. The buys bring the foundry giant's capex for 2009 to approx. $2.875b, higher than the company's most recent estimate for the year of $2.7b. Apparently TSMC has pulled in SPE for two reasons: 1) tax-holiday regulation issue, 2) stronger-than-expected demand from customers for 45nm and below. (EE Times, Nomura Research)

DRAM capex to hike 80% in 2010, says DRAMeXchange: Combined capex at DRAM chipmakers will reach US$7.8b in 2010, up 80% from US$4.3b in 2009, according to DRAMeXchange (Dec 23). Capex budgets for DRAM makers worldwide will reach US$10-12b in 2011 and 2012, a moderate rise compared to 2010, DRAMeXchange forecast. DDR3 is expected to account for 60% of total DRAM and become the leading technology for PC memory in 1Q10, said DRAMeXchange, adding that the share will likely reach over 80% in 2H10.

Hynix sees memory chip rebound; confirms 2010 capex increase: Hynix CEO Jong-Kap Kim said Monday Dec 27 that he expects a global shortage next year of DRAM chips, adding that, "Global demand for personal computers next year will likely increase 10%, and in that sense the industry outlook is expected to remain solid". He also said that he expects Hynix to be profitable in 2010, adding that Hynix's global market share for both DRAM and NAND flash chips may slightly increase in 2010. Mr. Kim said the chip maker may be able to repay about 1t won of its debt in 2010. It currently has around 7.5t won in debt. Earlier on Dec 24, Hynix confirmed that it will increase its planned capex for 2010 to 2.3t won (about $1.95b), after reportedly spending about $1b in 2009. (WSJ, EE Times)

Micron F1Q10 - rev, EPS beat on higher ASAP; sees FY2010 capex of $750-800m: Memory firm Micron posted F1Q10 (ended Dec 3) rev of $1.74b vs. cons $1.6b. Micron F1Q10 EPS (incl. $1.3b converts accounting impact) of $0.23 beat cons $0.07. DRAM rev up 50% on back of 25% increase in sales & 21% increase in ASP. NAND rev up 21% on back of 16% increase in sales & 5% increase in ASP. Micron Sees FY2010 (ending Sep) CAPEX of $750-800m. (TechTrader)

Spansion's plan to emerge from bankruptcy threatened by $1b dispute with Japan unit: Flash memory vendor Spansion reported Dec 31 its first quarterly profit since going public--despite declining sales--and said it plans to emerge from bankruptcy early in 2010. Spansion posted net income of $1.5m or 1c/share on rev of $327.6m in 3Q09 (ended Sep 27). However, in a later filing with SEC, Spansion said it is embroiled in a $1b foundry dispute with its estranged Japanese unit that "could be material and render the current plan of reorganization infeasible, which could hinder or delay the company's emergence from bankruptcy". (EE Times)

South Korea drops NAND price-fixing probe: concluding there was no evidence of price fixing, the WSJ reports. In August 2009, the story notes, Samsung, Toshiba and others were told by the U.S. Dept. of Justice that an antitrust investigation into the flash-memory chip market had ended, meaning neither company would face charges or fines. (TechTrader)

Couple of positive reads from the electronics supply chain on Dec 21: 1) Electronics distributor Arrow Electronics raised its outlook for 4Q09 on rising sales of computer chips and other components. 2) Contract manufacturer Jabil said during its F1Q10 (ended Nov 2009) results that it has “a good pipeline” of projects and a “stable to improving end market” (TechTrader)

Fairchild settles with Infineon over power semi suit: The lawsuit has been settled through a broad patent cross license relating to semiconductor technology and Fairchild will make payments to Infineon. Fairchild said it will record a $6m charge in 4Q09. The specific terms and conditions of the agreement were not disclosed. (EE Times, Reuters)

Samsung tops its goal for sales of LED TVs: Samsung Electronics said Jan 3 that it sold 2.6m units of LCD televisions with LED backlight technology in 2009, up from its initial target of around 2m units. Samsung said it expects its LED-backlit LCD TV sales to grow nearly fourfold to 10m this year (WSJ)

Technology Headlines – 05 January 2010
Photovoltaic JV announcement with Sharp and Enel: STM, Enel Green Power and Sharp signed an agreement for the manufacture of photovoltaic panels in an equal partnership. The project of 160 MW will require a total investment of Eur320m. All three partners will inject equity of up to €70M (cash or in-kind) with the remainder being funded by a combination of state grants and project financing. The STM consists primarily of the contribution in-kind of the M6 factory through an option agreement with Numonyx. Manufacturing should start early 2011. Enel, Sharp and the new Independent Power Producer (IPP) joint venture between Enel and Sharp are committed to off-take all production. The JV will be consolidation under equity method with minor equity loss in 2010 and being marginally accretive in following years. (Reuters)

Global chip sales up 3.7% m/m in Nov 2009 - SIA: The three-month average of worldwide sales of semiconductors rose to $22.645b in November (+3.7% m/m, +8.5% y/y). (Digitimes)

Apple tablet launch: Apple, seeking to win a larger share of the market for handheld computers, is planning to unveil a tablet PC this month, according to a person familiar with the matter. The device is scheduled to go on sale in March, said the person, who declined to be identified. Offering a tablet PC would help Apple capitalize on demand from consumers for devices with internet and multimedia access. (Bloomberg)

Nanya revenues up in 2009, but Inotera down: DRAM maker Nanya Technology has reported revenues of NT$42.46b (US$1.33b) for 2009, representing a 17% growth from NT$36.31b in 2008. However, Inotera Memories generated a 3.8% revenue slide in 2009, down for the second consecutive year, with revenues for 2009 reaching NT$36.1b, down slightly from the previous year's NT$37.54b. (Digitimes)

Icera setting its sights on a $1b listing: Icera, the UK-based wireless chip company, is planning a stock market listing with an estimated value of between $600m and $1b (£618m). The move would be the UK’s first semiconductor flotation since CSR, the bluetooth chip company, went public in 2004. Icera was co-founded by Stan Boland and Simon Knowles, who previously founded Element 14, a chip company that was sold to Broadcom for $594m in 2000. Mobile phone operators including Orange, Vodafone, AT&T and Japan’s Softbank use Icera chips in mobile broadband “dongles”, allowing them to connect laptops and other devices to wireless networks. (FT)

Realtek licenses MIPS32 Pro Series cores to develop high-performance SoCs: MIPS Technologies has announced that Taiwan-based Realtek Semiconductor has licensed a range of MIPS32 Pro Series cores for broadband, networking, digital home and multimedia SoCs. (Digitimes)

Technology Headlines – 06 January 2010
Global consumer electronics sales seen flat in 2010, With U.S. down 3%: says the Consumer Electronics Association (CEA). That follows growth of 14% in both 2008 and 2007, and 17% growth in 2006. It added that emerging markets - in particular China, India and LatAm - are adding opportunity for the industry, but price deflation and shifts in product composition is negatively affecting overall sales in developed economies. CEA sees 2010 global PC sales of 161m units, up from 151m in 2009, with laptops being 68% of PC units. Wireless handsets seen up 2% in units this year to 1169m, after down 2% in 2009. CEA sees 14% growth in LCD TV and 6% growth in high-def DVD players (Blu Ray) in 2010. (TechTrader)

STM unveils ARM-based 3D-Ready STB IC: The new STi7108 is the first set-top box IC in the market to combine 3D graphics, Ethernet, USB and e-SATA interfaces to connect Internet devices, DVR storage or external Flash or hard-disk (HDD) drives. The STi7108 utilizes the ARM Mali-400 graphics processor, and is ble to decode video in industry-standard formats, including H.264, MPEG2, VC-1 or WMV9 Internet video, and MPEG4 part 2, up to high-definition resolutions 1080p 50/60 simultaneously with 1080i/720p picture-in-picture or mosaic formats. (STM, Bloomberg)

Chip inventories set to remain lean in 1Q10, says iSuppli: Days of inventory (DOI) among chip suppliers are expected to decline to 68.3 at the end of the 1Q10 down from 68.5 for 4Q09, said iSuppli. With DOI already 2.9% below the historical average in the Q4, Q1 inventories are set to be 6.9% less than the norm. While inventory in Q1 will remain at about equilibrium level with demand, stockpiles will be at very low levels - even bordering on shortages for a few specific devices, iSuppli noted.

Synnex Q4 EPS, Revenue Beat: Computer distributor and contract assembly house Synnex posted fiscal Q4 (ended Nov 30) rev of $2.2b (+10% q/q, +5% y/y) vs. cons $1.87b and EPS of 87c vs. cons 76c. For Q1, it sees $1.88-$1.98b, which at the midpoint is ahead of cons $1.87b, and EPS of 83c to 89c, including an expected gain of 26c to 28c from sale of one of its businesses. Excluding that amount, the company’s looking at 55c to 67c, which at the midpoint is ahead of cons 60c. (TechTrader)

TSMC purchases US$4.5b worth of equipment in 2009: TSMC spent more than NT$145 billion (US$4.57b) on machinery equipment in 2009, while rival UMC allocated around NT$22b to equipment, according to respective company filings with the Taiwan Stock Exchange (TSE). Last year, TSMC distributed around NT$28b to Applied Materials and NT$24b to ASML, and over NT$10b each to Tokyo Electron, Dainippon Screen Manufacturing and KLA-Tencor. (Digitimes)

DRAM maker PSC sales down 41% in 2009: Powerchip Semiconductor Corporation (PSC) has reported unaudited revenues of NT$31.17b (US$982m) for 2009, representing a 41% decline from NT$52.83b in 2008. The Taiwan-based DRAM maker said it swung back into the black in the fourth quarter, following 10 consecutive quarterly losses. (Digitimes)

Infineon spinoff acquires WLAN IP: Infineon's wireline spinoff--Lantiq Inc.--has entered into a definitive asset purchase agreement to buy the wireless local area network (WLAN) business of Israeli firm Metalink for $16.9m in cash. Lantiq is a fabless semiconductor company funded by Golden Gate Capital. (EE Times)

MIPS - MStar licenses MIPS32 processor; to collaborate with Adobe to optimise flash: DTV IC vendor MStar has licensed MIPS multi-threaded MIPS32 34Kf Pro synthesizable processor core for next-generation devices. According to DisplaySearch, MStar was the market leader of video processor ICs in unit shipments in 4Q09. Meanwhile, at the CES, MIPS announced it is participating in Adobe's Open Screen Project, to optimize Adobe Flash Player 10.1 for the MIPS architecture. (Bloomberg)

Rexchip plans IPO in 2010, says president: Rexchip Electronics, which is 64%-owned by Elpida Memory, has announced plans to go public in 2010. The DRAM maker will file an application for IPO in Taiwan's stock market in Q1, according to company president Stephen Chen. Rexchip will get access to bank loans for half of its budgeted capex for 2010, said Chen, adding that the other half will depend on internal operations. Rexchip plans to allocate up to NT$12b (US$378m) this year. In line Taiwan's regulations for listing, Elpida will need to lower its stake in Rexchip to below 50%. (Digitimes)

Technology Headlines – 07 January 2010
Samsung set for strong 2010; chip business improves: Samsung estimated preliminary 4Q09 consolidated operating profit at a mid-point of 3.7t won ($3.27b) vs. cons 3.54t won. Samsung estimates 4Q09 consolidated sales at a median 39t won, which would be a record, in a range of 38-40t won. It is due to report official quarterly results later this month. (Reuters)

Samsung eyes TV sales jump, gets in on eBooks: Samsung said it aimed to sell 35m LCD TVs in 2010, including 10m LED TVs. And the company debuted a wireless e-book reader that will let users write or draw directly on the display, getting into what is one of the hottest gadget markets. Coming in six- and 10-inch screen sizes, Samsung's e-readers will be able to download books from Google and sell for $399 and $699. The company also announced what it called the world's first HDTV applications store, where users can buy and download software programs -- ranging from news and games to Twitter or Blockbuster video rental services -- on select Samsung HD TVs and home video systems. It set this year's target for plasma TV sales at 4m units. "3D will attract a lot of attention in 2010," said Yoon Boo-keun, president of Samsung's visual display division, adding that "We will create a new market for 3D LED TVs." While competition will likely lead LED set prices to fall at a faster rate than last year, Yoon expected the decline would be limited due to tight panel supplies. (Reuters)

Marvell claims first quad-core ARM processor: Marvell Technology claims to have developed the world's first "quadruple" core processor based on the ARM architecture. Marvell's quad-core implementation can operate at above 1-GHz and has been designed for "high volume gaming applications" and other mass consumer applications. The quad-core is based on the same CPU architecture as Marvell's recently launched ARMada 500 and 600 processors. These are declared to be ARMv7 instruction set architecture processors but it has not been revealed whether they are based on Marvell designs from the ground up or on a core supplied as IP by ARM, such as the Cortex-A8 or Cortex-A9. The Cortex-A9 is an ARMv7 processor designed to support up to four-way multiprocessing. (EE Times)

Qualcomm signs agreement with GlobalFoundries for advanced nodes: The intended relationship with GlobalFoundries will focus on Qualcomm`s wireless businesses and provide technologies for handheld products that operate on the CDMA2000, WCDMA and 4G/LTE cellular standards, including the emerging smartbook device segment. Both companies anticipate that GLOBALFOUNDRIES will begin accepting Qualcomm designs at Fab 1 in Dresden in 2010. Initially, GlobalFoundries intends to provide Qualcomm with access to leading-edge 45nm Low Power (LP) and 28nm (LP) technologies with an intended collaboration on future advanced process nodes. In addition to advanced technology nodes, the two companies intend to explore other areas to collaborate on such as die-package interaction and 3D packaging. (Reuters)

Microsoft CEO unveils new HP tablet: Microsoft CEO Steve Ballmer unveiled a new HP tablet computer on Wed, beating Apple's hotly anticipated move into the market. Ballmer did not detail pricing or when the device will hit stores. An earlier New York Times report said it could go on sale by mid-2010. (Reuters)

ASML state aid: ASML received EUR 35m million in state aid in 2009, Dutch newspaper Het Financieele Dagblad said today, citing Chief Financial Officer Peter Wennink (Bloomberg).

STM shareholder structure: France’s Strategic Investment Fund and state-owned Caisse des Depots et Consignations are candidates to buy Areva’s 11% stake in STM, Le Figaro reported. (Bloomberg)

CES: Lenovo shows hybrid x86/ARM notebook: Lenovo is launching a hybrid x86/ARM-based notebook just one day after announcing an ARM-based smartbook. The IdeaPad U1 supports both an X86/Windows 7 and a separate Linux environment running on an ARM processor. The Lenovo U1 is essentially a standard 3.8-pound notebook PC with a detachable 11.6-inch multi-touch screen that can act as a tablet using the ARM environment. Users will be able to switch between the Windows and Linux environments. They share common resources including the system's battery, 3G cellular modem, data and documents. (EE Times)

ProMOS approved to extend maturity of all term loans for one year: Taiwan-based ProMOS Technologies has received approval from creditor banks to extend the maturity for all its term loans for one year, effective January 1, according to the company. ProMOS has secured a foundry contract with Elpida Memory to utilize its 300mm (12-inch) wafer fab in Taiwan for the manufacturing of Elpida's DDR3 chips. PSC has claimed that it returned to profitability in the fourth quarter of 2009 following 10 consecutive quarterly losses. (Digitimes)

Inotera set to raise NT$15b through rights issue: DRAM maker Inotera Memories has set the price of its latest rights issue at NT$22.5 per share (US$0.71), and expects to raise a total of NT$15b to finance its technology upgrades, according to the company. The price is around 25% lower than NT$28.20, the closing price of Inotera shares on Jan 6 on the Taiwan Stock Exchange (TSE). Inotera will issue 640m new shares, with shareholders Micron Technology and Nanya Technology expected to subscribe to 80% of the new shares. Inotera said it is converting from trench to stack technology, and sticks to the goal of completing its migration to 50nm stack by the end of 2010. Inotera is scheduled to reveal 4Q09 results at its investor’s conference on Jan 20. (Digitimes)

Technology Headlines – 08 January 2010
Intel marks re-entry to market with smartphone: Intel unveiled a smartphone at CES in Las Vegas on Thursday, marking its re-entry into the handset market after an absence of four years. In a keynote speech, Paul Otellini, Intel CEO, showed off a smartphone made by LG, using a new generation of lower power Atom processors codenamed Moorestown. It has a 3D interface, can display HD video and will go on sale in 2H10. The world’s biggest semiconductor producer also announced an “app store” for netbooks. Mr Otellini said that the smartphone would run on a 32nm chip and Intel would be reducing the size to 22nm. Mr Otellini said he did not think AppUp was a threat to its partner Microsoft, which he said was taking part with its Silverlight platform for creating apps. (FT)

Intel on ARM/Atom “Pine Trail”: Intel VP Tom Kilroy in an interview didn’t seem too concerned with the threat to Atom-processor based netbooks by “smart books” built on the Snapdragon processor or ARM-based processors and running Linux. He notes that the early generation of netbooks were Linux based, but what people have mostly purchased were Windows-based hardware. He also notes that Intel has an improved 2nd-generation Atom processor, dubbed Pine Trail, launched in December, offering more competitive performance with the rival chips (TechTrader).

Pace on track to meet 2009 expectations: Pace on Thursday said it was on track to meet management expectations for 2009 following a strong year for the company. Analysts are expecting sales of £1.12b ($1.78b), about £80m of pre-tax profit and EPS of about 18p. Neil Gaydon, CEO, said net cash would be more than £70m. At the beginning of 2009, analysts had expected just £20m in profit from the company, but revised estimates sharply as Pace began to see benefits from its 2008 acquisition of the Philips set-top box operations. Pace has also benefited from a push into high definition programming by satellite and cable companies, which has meant new upgrade cycles of set-top boxes. (FT)

Texas Instruments to enter e-Reader market: TI said its new e-book technology will let manufacturers produce more energy-efficient e-readers at lower costs. TI claims that it had found ways to replace display control functions performed by four pieces of hardware on most current e-book readers with software, thus reducing the cost of the physical components in the devices. TI added the cost savings would depend on the size of a manufacturing run, but was "fairly significant." Global sales of e-readers are expected to surge to 12m units in 2010 from 5m in 2009, according to research firm iSuppli. (WSJ)

Nvidia declares year of the tablet: Nvidia CEO Jen-Hsun Huang declared 2010 the year of the tablet. Nvidia hopes to play a major role in tablets through a new Tegra chip announced today. It’s a dual-core mobile processor that Huang said will deliver 10 times the performance of the average smartphone, while delivering four to eight times greater resolution. Meanwhile, the chip will sip 20 times less power than a PC, he says (TechTrader).

UMC dismisses rumors it is targeted by ATIC for acquisition: UMC has declined to comment on a media report indicating that the company is being targeted by Advanced Technology Investment Company (ATIC) for acquisition, stating it is purely market speculation. ATIC, owned by the Abu Dhabi government, is mulling plans to buy UMC following its previous buyout of Chartered Semiconductor Manufacturing, according to a Chinese-language Economic Daily News (EDN) report published on Jan 7. The Taiwan-based paper cited unnamed foreign institutional investors as its source. ATIC in Dec 2009 completed its Chartered acquisition, and said it would step up efforts to combine Chartered's and GlobalFoundries' technology, talent and capacity to bring a new entity to the marketplace. (Digitimes)

Handset chip sales bounced in Q4, says ABI: Connectivity chips showed the greatest growth within the mobile phone semiconductor market, according to ABI Research. The total revenue for handset Bluetooth, GPS, and WLAN in 2009 is forecast to grow 16% compared to 2008, exceeding $1.9b, and to show a CAGR of 11% between 2009 and 2014, the market researcher said. (EE Times)

Technology Headlines – 11 January 2010
Intel expects to get boost from web-connected TVs this year: Intel will finally crack the home-electronics market in 2010 as the chipmaker’s products become central to bringing the Internet to television screens, said SVP Eric Kim. “It’s going to take off like a rocket,” Kim, who heads Intel’s digital-home unit, said at CES in Las Vegas. “We have a full solution now.” Under CEO Paul Otellini, Intel aims to get its chips into more home electronics -- a bid to lessen the company’s dependence on PCs, which provide about 90% of sales. Intel’s attempt to break into the market was slowed by having to coordinate all the software, chips and content needed to deliver Internet TV devices, Kim said. Kim declined to say who his TV-industry customers are, citing their desire to introduce their own products. (Bloomberg)

Seagate CEO sees 15%-Plus HDD growth in 2010: In an interview Friday with Tech Trader Daily at the CES in Las Vegas, Seagate CEO Steve Luczo said that while many analysts are projecting growth of 10%-15%, he thinks the actual increase could be bigger. “I think we’ll be chasing demand all year,” he said, adding that “2010 is going to be a growing year for tech globally,” followed by 2011 which will be "a monster, with the world clicking on all cylinders.”. (TechTrader, Bloomberg)

Qualcomm, TSMC extend collaboration to 28nm: TSMC on Jan 8 announced its partnership with Qualcomm has been extended from 65nm and 45nm technologies to 28nm, only a day after Globalfoundries revealed it has pending orders placed by the fabless chip vendor. TSMC said it is working with Qualcomm on both high-k metal gate (HKMG) 28HP and silicon oxynitride (SiON) 28LP technologies. The client expects to tape out its first commercial 28nm products in mid-2010. GlobalFoundries expects to begin accepting Qualcomm designs at Fab 1 in Dresden in 2010. (Digitimes)

Spansion Said to seek $450 Million Exit Financing: Spansion, the maker of flash memory technology, is seeking a $450m term loan to exit from bankruptcy, according to people familiar with the financing. Barclays Capital and Morgan Stanley are arranging the borrowing, said the people, who declined to be identified because the talks are private. “We expect to emerge from Chapter 11 in the first quarter of 2010 with a healthier capital structure and a broad product portfolio, positioned to compete in our target markets,” John Kispert, Spansion CEO, said today in an e- mailed statement. The banks will hold a meeting Jan. 12 in New York at 9:30 a.m. to discuss the loan, which will mature in five years, the people said. (Bloomberg)

TSMC sales down 11.2%, UMC down 4.2% in 2009: On an unconsolidated basis, TSMC net sales for Dec 2009 were approximately NT$ 30.47b (about $955m), +3.8% m/m and +131.5% y/y. Full-year sales for 2009 totaled NT$285.74b (about $8.96b), -11.2% y/y. In case of UMC, net sales on an unconsolidated basis in Dec 2009 were NT$9.3b ($291.6m), +1.49% m/m and +101.59% y/y. Full-year sales for 2009 totaled NT$88.6b ($2.78b), -4.23% y/y. (EE Times)

UMC plans NT$5b purchase of ProMOS factory, Daily says: UMC plans to invest NT$5b to take over a chip factory owned by DRAM maker ProMOS, the Economic Daily News reported today, without citing the source of the information. UMC’s factories making 12-inch wafers are currently running at full capacity with addition of the ProMOS 12-inch plant in Hsinchu, Taiwan aiding its expansion, the newspaper reported. UMC CFO Liu Chi-tung declined to comment, the newspaper reported. Meanwhile ProMOS spokesman Ben Tseng said by phone today that it has held talks to possibly sell a factory at its Hsinchu, Taiwan headquarters. ProMOS may sell, keep or spin-off the factory as a separate entity, with the decision likely to be made before the Lunar New Year (Feb 13), Tseng added. Tseng also declined to comment on the Economic Daily News report linking UMC with the deal. (Bloomberg)

Taiwan Won’t Invest in TMC, Daily Reports: Taiwan will not invest in Taiwan Innovation Memory (formerly TMC) through its National Development Fund, the Economic Daily News reported, citing Vice-Premier Eric Chu. (Bloomberg)

Technology Headlines – 12 January 2010
Foxconn posts on-year drop in 2009 revenues: Foxconn Electronics (Hon Hai Precision Industry) has announced revenues of NT$133.12b (US$4.19b) for Dec 2009, down 9.68% m/m, but up 8.98% y/y. The company's annual revenues in 2009 dropped 3.56% on year to reach NT$1,420.57b. Foxconn's on-month revenues drop in December was mainly due to seasonality for consumer electronics products. Revenues from PC and communication businesses remained flat on month in Dec, the company explained. (Digitimes)

Tokyo Electron Oct-Dec semi tool orders up 36% q/q: Tokyo Electron said orders for its tools to make microchips, flat displays and solar cells rose 17% in the three months to December from the previous quarter to about 110b yen ($1.2b). Orders for tools used to make semiconductors rose 36% to 108b yen. “Demand from Japanese and Asian memory makers, as well as U.S. logic chip manufacturers bolstered orders in the quarter,” company spokesman Kazuya Nanbu said by telephone today. “Taiwanese foundries also kept their bookings at a relatively high level”. (Reuters, Bloomberg)

Emulex Pre-Announces Strong FY Q2: For F2Q10 (ended Dec 27), the networking hardware company now sees revenue of $107-108m, well ahead of previous guidance of $88-92m. Emulex said it now sees non-GAAP EPS of 16-17c, ahead of its previous forecast of 10-12c. The company said it saw strong demand for both host server products and embedded storage products. (TechTrader)

Cirrus ups guidance: Cirrus Logic said it now sees Q3 revenue of $65m above previous guidance of $58-62m. The company said the better-than-expected results reflected strong demand for a range of audio products, and modest improvement in demand for energy products. Cirrus says gross margin in the quarter was about 54%. The company said it expects March quarter revenue of more than $53m (consensus $49m), or better than 58% y/y growth (TechTrader).

UMC reportedly to invest US$300m in LED supply chain in China: UMC is likely to invest a total of US$300m in founding around nine new subsidiaries located in Jinan in the Chinese province of Shandong, where it plans to offer a complete supply chain for its LED investment in China along with chip-making affiliate Epistar, according to local media reports. In response, UMC said any of its China investment projects have been and will be disclosed through company filings. UMC in August 2009 launched a wholly-owned subsidiary - UMC New Business Investment - to focus on its energy saving-related investments. (Digitimes)

Analog ASICs show flattish CAGR, says Gartner: Revenue for application-specific analog integrated circuits (ICs) totalled $28.1b in 2008 and will reach $32.2b in 2013, according to a new report from Gartner. This corresponds to a CAGR of about 2.75%. However, the market is likely to have fallen in 2009 and that would call for stronger CAGR from 2009 through 2013. As a general rule, standard analog ICs represent roughly 40% of the total analog market; application-specific devices are roughly 60%. Standard analog ICs represented $17.8b or 38.8% of the total in 2008, Gartner said. (EE Times)

PC assembly costs to rise this year: The cost of assembling personal computers will rise this year for the first time in six years because of shortages in some key components, industry analysts have forecast. The cost of semiconductor components in computers has fallen by an annual average of 7.8%t since 2000, but they are set to rise this year by 2.8%, according to data from Gartner. This is almost entirely attributable to a 23% increase in the price of D-Ram memory chips, which comprise about 10% of a PC’s overall cost. (FT)

Technology Headlines – 13 January 2010
Foundry chipmakers see yields for 40nm production below 70%: Foundry chipmakers, including TSMC, have been struggling to increase their yields on 40nm to over 70%, according to industry sources. The unsatisfactory yield rate has caused production for next-generation graphics processors and FPGA (field-programmable gate array) chips to run tight. Clients using TSMC's 40nm node include GPU vendors AMD and Nvidia, and FPGA chip supplier Altera. Sources claimed that FPGA chipmaker Xilinx, which has placed orders for 40nm-generation products with UMC, has also moved to diversify its production sources. Samsung Electronics earlier announced it has been selected as one of Xilinx' foundry partners for next-generation FPGA manufacturing. (Digitimes)

GlobalFoundries to announce Chartered merger plans on Wed; CEO says no more M&A / IPO for now: GlobalFoundries is already beginning to work with suppliers and partners as one company, CEO Doug Grose told Reuters in an interview. GlobalFoundries will officially announce its merger plans on Wednesday. Grose also said that GlobalFoundries is not eyeing any more mergers or acquisitions, nor an IPO for now. Although chips rolling off former Chartered assembly lines will be marked with the new company's name within the month, Grose said the two entities are not entirely integrated. Grose also said that AMD will reduce its stake in the company over time, and continue to focus on chip design. GlobalFoundries will not only microprocessors, for AMD, but it will also manufacture separate graphics chips for AMD's ATI visual chip division sometime in the future. (Reuters)

GlobalFoundries offering discounts on wafer, Photomask prices: GlobalFoundries has quoted Photomask prices that are 40-50% lower than quotes offered by rivals, and cut prices for wafer processing at its available nodes to vie for handset- and network-related chip orders, according to market sources. The moves are likely to trigger a price war on advanced 45nm and beyond processes. GlobalFoundries' recent price cuts have drawn interest from some of TSMC's larger customers, the sources indicated. In addition, the sources said GlobalFoundries will benefit from new clients brought in by Chartered including major ones like Nvidia, Broadcom, Qualcomm and TI. (Digitimes)

Intel Q4 - To reveal additional info during results: Intel will give investors more financial information on the progress of its attempts to expand beyond personal computers. The company will disclose sales and operating income for a group called “Other Intel Architecture” in its earnings release on Jan 14, according to a statement today. That group includes chips sold for TVs, mobile phones and industrial applications, Intel said. CEO Paul Otellini has renewed attempts to lessen Intel’s reliance on the PC market, which provides about 90% of its sales. (Bloomberg)

MCU supply falling short of demand on tight backend capacity: Supply of 8-bit microcontroller units (MCUs) is falling short of demand due to tight capacity in backend houses, according to industry sources. Worldwide first-tier MCU makers have seen short lead-time MCU orders from the LCD TV and electric car sectors, while Taiwan-based makers are optimistic about demand from the PC and notebook markets. Toshiba, NEC and Renesas all have been speeding up production to meet increasing MCU orders. Taiwan-based Holtek Semiconductor, Sonix Technology and Weltrend Semiconductor are also expected to benefit from strong market demand, the sources indicated. (Digitimes)

MediaTek Dec 2009 rev fail to meet market expectations: MediaTek has reported revenues of NT$9.36b (US$294.66m) for Dec 2009, down 7.45% on month but up 83.2% on year. Market watchers earlier expected MediaTek’s Dec rev to reach NT$10-10.3b, about the same level as in Nov. The company's rev for 2009 totaled NT$115.27b, +28.37% y/y. (Digitimes)

Technology Headlines – 14 January 2010
TSMC denies buying Nikon's immersion tool: "We didn't buy immersion from Nikon according the filing. We still buy from ASML," said Dennic Hu of the Production Equipment Procurement Division at TSMC, in an e-mail. ''Nikon is our partner in providing us dry scanners." (EE Times)

Xilinx says delivery of 40nm generation products progressing smoothly: Xilinx is working closely with its foundry partners, and sees no supply constraints on 40/45nm FPGAs, according to Fai Yeung, VP of sales for Xilinx Asia Pacific. Demand for high-end FPGA chips will be buoyed by 3G and 4G network deployments in China and other Asia markets in 2010, said Yeung. UMC manufactures 40nm generation products (Virtex-6) for Xilinx, whereas Samsung Electronics is shipping 45nm chips (Spartan-6) to the FPGA customer. (Digitimes)

Worldwide PC unit sales jumped 22.1% in Q4, says Gartner: Worldwide PC shipments topped 90m units in Q4, increasing 22.1% from a year ago, according to new data from Gartner. In terms of mkt share, HP (19.8%), Acer (13.5%), Dell (11.5%), Lenovo (8.7%) and Toshiba (5.3%) were the top 5 global PC vendors. (TechTrader)

Japan chip-gear sales to grow 38% in FY2010, says SEAJ: Sales of Japan-made semiconductor and flat-panel display (FPD) equipment are forecast to reach 1.12t yen (US$12.3b) in fiscal year 2010, up 37.7% from 813b yen in fiscal 2009, according to SEAJ. In semiconductor equipment, SEAJ estimated sales are set to increase 36.7% to 769.8b yen in the year ending Mar 31, 2011, with about 35% of the sales coming from the local Japan market. (Digitimes)

Samsung urges for more EUV support: President of one of Samsung's R&D unit Kinam Kim said that "I am 100 percent confident we will make EUV available". He also acknowledged that EUV must overcome some technical hurdles, such as the power source and mask infrastructure. "We require more aggressive participation'' from the tool vendors and IC industry, he added. (EE Times)

Kingston reportedly pays US$100m for memory chips to Hynix: US-based memory module house Kingston Technology has made an advance payment of US$100m to Hynix Semiconductor for the purchase of DRAM chips and NAND flash in 2010, according to industry sources. The sources said memory module makers are moving to rely less on Samsung Electronics, which tends to give priority to PC and system OEMs. (Digitimes)

OmniVision Affirms FY Q3 Rev View: Digital imaging firm OmniVision said that it continues to expects revenue for its fiscal third quarter ending January 31 of $145-160m. The company first issued that guidance on Nov 30. The Street consensus is for $154.2m. (TechTrader)

Hynix intros 2GB DDR2 for mobile applications: Hynix Semiconductor has developed 2-gigabit (2 GB) low-power DDR2 DRAM for mobile applications such as smartphones and tablet PCs, with volume production slated for 1H10, according to the company. Hynix also claimed the new 44nm mobile DRAM consumes 50% less power compared to its previous generation. (Digitimes)

Technology Headlines – 15 January 2010
Intel Q4 crushes ests - Q4 GM 64.7%; CFO sees return to normal inventory levels: Q4 rev $10.6b, (+28% y/y) vs. cons $10.17b, GAAP EPS of 40c vs. cons 39c and GM of 64.7% (+1160 bps y/y, +700bps q/q). For Q1, it sees rev of $9.7b (+/- $400m) vs. cons $9.35b, GM of 61% (+/- 200bps). 2010 GM 61%, (+/- 300bps), up from 55.7% in 2009. The company said ASP for microprocessors was up q/q in 4Q09. Rev +10% q/q in the PC client group, +21% in the Data Center Group and +22% in the Other Intel Architecture Group. Atom processor and revenue group +6% q/q. Intel expects CAPEX in 2010 of $4.8b (+/- $100m) vs. $4.5b in 2009. Intel CFO Stacy Smith indicated that the company has “seen a return of consumer demand and replenishment to normal inventory levels after the precipitous demand drop at the end of 2008 and the beginning of 2009.” Europe grew 15% q/q; Japan was up 8%; Americas was up 15%; APAC was up 12%.

STM Completes Partial Bond Repurchase Program: STM said it completed a program to repurchase a portion of its outstanding zero coupon senior convertible bonds due 2016. A total nominal value of $298.2m of the bonds were repurchased, representing about 30.6% of the total amount originally issued. The bonds were purchased in off-market transactions by financial intermediaries and the company paid $314.6m from outstanding cash, it said. (Bloomberg)

MediaTek sees orders slowing down: Order momentum for MediaTek's 2.5G, WCDMA, TD-SCDMA and EDGE smartphone chips has been slowing down as handset makers are not aggressively pushing new devices, according to industry sources. Although the IC designer's Jan revenues are likely to rebound thanks to customers' inventory replenishment before Lunar New Year, its revenues may drop significantly in Feb impacted by the long holiday, said the sources. MediaTek's first-quarter rev are expected to decline 5-10% q/q. The company's revenues dropped 15.2% to NT$29.11b (US$916.73m) in 4Q09 partly due to lower-than-expected orders from the Middle East amid the Dubai debt crisis, and partly due to inventory taking by customers, the sources indicated. (Digitimes)

JSR President Expects Semiconductor Market to Expand This Year: Mitsunobu Koshiba, president of JSR Corp., the world’s largest maker of photoresist, said demand for semiconductors will probably increase this year. “The recovery in the semiconductor market has lagged behind that of the LCD market, but it’s been rebounding since the April-to-June period, led by flash memories used in smartphones and Intel’s new processor. In the second half of this year, there will also be a push from Windows 7. The DRAM market is rapidly recovering on notebook computers. Factories for 300mm wafers are utilized more and more intensely. Semiconductor production normally peaks in November, but thanks partly to the Chinese New Year, the demand-supply environment in December and January has been better than November, and I reckon it will further improve." (Bloomberg)

ARM / Nvidia Tegra shipments estimated to reach 2.5-3m units in 2012: Nvidia's Tegra processor shipments are estimated to increase from about 100,000 units in 2009 to 2.5-3m units in 2012 as the processor will be fully adopted in Audi's automobile lines in 2012, according to market watchers. Orders for Tegra processors from automobile players including Audi, Volkswagen, Bentley, Lamborghini, Seat and Skoda, in 2012 are estimated to reach 1.5m units, accounting for about half or even 60% in Nvidia' total shipments, while the other 1-1.5m units will be mainly used for smartphones, mobile PCs and digital music players, the market watchers noted. (Digitimes)

Technology Headlines – 18 January 2010

Avago Technologies updates F1Q10 guidance: Analog semi firm Avago now sees F1Q10 (ending Jan 31) non-GAAP rev up 3.0 to 5.0% q/q (vs. prev. flat to down 3% q/q), primarily as a result of stronger than anticipated sales in the wired infrastructure and industrial target markets. In addition, during the quarter to date the Company said it has seen a degree of price stabilization across all of its target markets. It also revised its GM to 45% (+/- 50bps) vs. prev. 41.5% (+/- 50bps). (Bloomberg)

ChipMOS to sell Spansion debts to Citigroup: ChipMOS Technologies has announced it reached a definitive agreement with Citigroup, under which the memory packaging and testing company will sell the debts it holds in Spansion at half price. The recognized gain is estimated at US$150-152m which will be included in ChipMOS's 2010 financial data. ChipMOS said its accounts receivable from Spansion, which is currently in Chapter 11 insolvency proceedings, amounts to US$66-70m. ChipMOS has agreed to sell the uncollected accounts for US$33-35m to Citigroup. Citigroup will also purchase ChipMOS's unproductive accounts receivable worth US$234m from Spansion for about US$117m, according to ChipMOS. In the meantime, Fulcrum Credit Partners has filed a complaint, alleging it reached a binding agreement to acquire ChipMOS' uncollected accounts from Spansion. However, ChipMOS has denied the allegations. (Digitimes)

PSC to offer cash compensation to encourage conversion of ECB into shares: Taiwan-based DRAM maker Powerchip Semiconductor Corporation (PSC) will encourage holders of its US$133m zero-coupon ECB (euro convertible bond) to convert their issues into PSC shares by offering cash compensation for the gap between the bond principal and the stock market value of shares, according to PSC. The ECB maturing on Feb 2, 2010 has a conversion price of NT$15.87 per PSC share, much higher than PSC's stock price of NT$4.91 per share on Jan 15. PSC will offer cash to cover the gape between the conversion price and the market value of the shares to prevent the ECB holders making losses from the conversion, the company explained. (Digitimes)

19/01/2010

ASML, Buy, Consensus still rising, Dr. Gunnar Plagge, ASML - Earnings Preview - Consensus still rising
Investment Conclusion
We are reiterating our Buy rating on ASML with a price target of EUR 28 as we expect a strong set of Q4 numbers that could beat on the top line and positively surprise on the order number with very firm DRAM and foundry demand and flash remaining the main swing factor, although expectation are already high. On the more qualitative side we see three topics as potential further catalysts around the Q4 results: 1) Reassuring management comments on competitive dynamics, 2) a focus on potential buy-backs & M&A and 3) a more confident view on a sustained memory capex cycle

Summary
• Expected strong Q409 results & order momentum
• Product launches & marketing
• Buy backs & acquisitions as a topic
• Sustained memory upcycle

Infineon Shareholder Seeks to Oust Chairman, FTD Says: U.K. pension fund Hermes named its own preferred candidate for chairman of Infineon Technologies AG’s supervisory board, Financial Times Deutschland reported, without saying where it got the information. Hermes proposed Willi Berchtold as the new chairman, the FTD said, according to the e-mailed preview of an article that will appear in tomorrow’s edition. Infineon has already nominated Klaus Wucherer as the replacement for current chairman Max Dietrich Kley. (Bloomberg)

Hynix plans to repay more than 1t won in debt: “Our goal is to pay back a significant amount of debt while at the same time being able to invest in what we require,” Kim Jong Kap, CEO of Hynix, said. The company currently has about 7t won in interest- bearing debt, Kim said. Hynix creditors, who are trying to recoup the $4.6b spent bailing out the chipmaker, said last week they may help finance an acquisition as they try to sell all or part of their combined 28% stake. Sale arrangers will accept letters of intent from prospective buyers until Jan. 29 and plan to select a preferred bidder in the second quarter, sale arranger Credit Suisse Group AG said Jan. 13. (Bloomberg)

South Korea Seeks UAE for Investment in Hynix Semiconductor: South Korea has sought the UAE for possible investment in Hynix Semiconductor, Vice Knowledge Economy Minister Kim Young Hak said. “We are open to any country, not just the U.A.E., to invest in the company,” Kim said in an interview in Abu Dhabi yesterday, without stating whether an investment would involve a stake purchase. (Bloomberg)

Taiwan Semi’s Chang ‘More Optimistic’ on Chip Market : TSMC Chairman Morris Chang said recent discussions with clients has made him “very optimistic” about the global chip market this year as the company plans to recruit and spend more. “Direct contact with customers and looking at the market situation,” spurred the increased expectations, Chang said in an interview today in Taipei without providing further details. “I’m even more optimistic now” than back in October, he said. Chang said Oct. 29 he expects the global chip industry to climb 10% this year from last year and to recover to 2008 levels between 2010 and 2011. (Bloomberg)

NEC Electronics shares rise on report quarterly loss narrowed: NEC Electronics, rose to the highest level in three months in Tokyo trading after the Nikkei newspaper said its operating loss narrowed in the fiscal third-quarter. The operating loss, or sales minus the cost of goods sold and administrative expenses, probably narrowed to about 8b yen ($88m) in the three months ended Dec. 31, from 19.9b yen deficit a year earlier, the report said, citing demand for chips used in flat-panel televisions. Sales probably fell 6% to about 120b yen, it said. NEC Electronics, which plans to report third-quarter earnings on Jan. 27, isn’t the source of the report, the company, said in a statement today. (Bloomberg)

STM joins CEA-Leti IMAGINE Program to develop multiple E-Beam Litho: STM and French semiconductor research institute CEA-Leti have signed an agreement for STM to join the new industry/research multi-partner program IMAGINE, led by CEA-Leti, which includes TSMC, for mask-less lithography for IC manufacturing. “STMicroelectronics has been working for more than a decade with CEA-Leti on maskless lithography.", said a senior STM official, adding that “Joining the IMAGINE program is a logical step for ST to get access to a mask-less lithography possible solution for future technology nodes.” (Bloomberg)

Quanta seeks new ventures, devices after record profit in 2009: Quanta Computer, the world’s second-largest maker of notebook computers by shipments, plans to make more strategic investments this year and expand into iPhone-style handheld devices following record profit last year, Chairman Barry Lam said in an interview. “We are looking for joint ventures with some companies that are already successful in the market -- if they need some financial investment -- as a strategic partner,” Lam, 60, founder of the Taiwan-based company said yesterday in Taipei. He declined to name targets. “We made a very good profit, a record high profit last year,” Lam said, declining to provide details because the data hasn’t been released. “I look forward to another good year for notebooks.” (Bloomberg)


21/01/2010

ASML, Buy, Change of Earnings Forecast - 12% higher top line forecast, Dr. Gunnar Plagge, ASML: Change of Earnings Forecast - 12% higher top line forecast
Investment Conclusion
Based on the strong Q4 order intake and an expected continued strong order momentum, we have increased our 2010 top line forecast by 12% and for next year by 7%. We found management comments with regard to our overall industry stance on memory and on SSD adoption reassuring. We continue to believe that we are in the second year of a typical five-year memory cycle. Although that would suggest a more difficult business environment for ASML in 2013, management comments support our hypothesis of a relatively late SSD adoption cycle that will require lithography capacity additions also in 2013. We note that on our 2012 earnings forecast of EUR2, the stocks trades on about 9x PE adjusted for cash. We are reiterating our Buy rating on ASML with a price target of EUR 28 that remains based on our Price/Book valuation approach.

Summary
• Q409 results review
• Change of estimates
• Valuation methodology

Seagate F2Q10 - rev, EPS crush ests; upbeat Q3 and FY outlook; CFO sees PC unit demand to grow 15%-20%: Seagate posted F2Q10 (ended Jan 1) rev of $3.03b (vs. $2.27b in F2Q09) ahead of cons $2.85b and guid $2.75-2.85b. EPS of $1.03 beat cons 65c. GM of 30.5% vs. guid range of 22%-26%. Seagate said it shipped 49.9m disk-drives in the quarter, with total industry shipments of 160m units. For F3Q10, it sees industry unit demand of 155-160m, with rev of $2.9-3.1b vs. cons $2.72b, and GAAP EPS of 88-92c vs. cons 56c. Seagate also said that the company’s old FY2010 guid of rev of $10.5b with non-GAAP EPS of $2.20 is clearly too low, although they did not provide specific new full year guid. Seagate CFO Patrick O’Malley this afternoon said the company expects PC unit demand to grow 15%-20% in 2010 - and adds that the only thing preventing faster growth might be industry production constraints. He also said that a rebound to pre-recession levels in the enterprise segment is likely this year, and notes that the pick up in enterprise sales in Q4 reflected more than the usual year-end IT budget flush. (TechTrader)

STM Sees Global Chip Sales Rising More Than 10%: Global semiconductor sales may rise more than 10% in 2010 as recovering economies create “strong demand” for chips, said STM CEO Carlo Bozotti. The market may register “just over double-digit growth,” Bozotti said in an interview in Rome today. “Demand is strong at the moment and of course we need to revise our plans up,” the CEO said. (Bloomberg)

Areva’s Sale of Eramet, STM Stakes Not Urgent, Echos Says: Areva SA’s plan to sell its stakes in nickel producer Eramet SA and chipmaker STMicroelectronics NV isn’t urgent because the nuclear-plant maker needs cash only from 2011, Les Echos reported, citing people it didn’t identify. Areva is holding talks to sell its 25.4 percent stake in Eramet and its 11 percent stake in STMicro to FSI, a French sovereign wealth fund, the newspaper said. The talks to sell the Eramet stake are stalled as Areva and FSI struggle to agree on the value of the mining company, according to Les Echos. (Bloomberg)

Logitech Q3 - rev declines y/y but net income beat: European PC peripherals firm Logitech posted F3Q10 rev of $617m (-2% y/y, -7% y/y on constant FX) with its retail sales up 3% y/y (Americas +8%, EMEA +6%, Asia -17%) and OEM sales down 38% y/y. Operating income of $58m (+37% y/y) includes the impact of $5.8m in one-time transaction costs related to the Company’s acquisition of LifeSize Communications in Dec 2009. Net income of $57m (vs. $40m in F3Q09) beat cons $46.9m. For F4Q10, Logitech expects sales of $500-515m, GM of approx 34%, and operating income of $15-20m, which includes the recurring impact of amortization of the intangible assets of LifeSize Communications. (Reuters, Logitech)

TSMC says 40nm yield issues resolved; raises 2010 R&D to US$850m: TSMC has improved yield rates on its 40nm manufacturing process, with the quality now being about the same level as its 65nm node process, according Mark Liu, SVP of Operations. During a company event yesterday, Liu stated that the chamber matching problems that had impacted yield rates for the company's 40nm node have been resolved. Liu did not elaborate any further. Meanwhile TSMC CEO Morris Chang said that it plans to raise its R&D budget from NT$21.6b last year to NT$27b (US$850m) in 2010. (Digitimes)

Hynix 4Q09 profit soars 167% on quarter: Hynix Semiconductor has announced rev for 4Q09 grew 32% q/q driven by rising DRAM and NAND flash shipments and a rebound in DRAM ASPs. In line with the revenue growth, it saw net income for the quarter jump by 167% q/q. Hynix reported consolidated rev of 2.8 t won (US$2.47b). Hynix said its DRAM ASPs and shipments rose by 26% and 12%, respectively, on quarter in 4Q09. As to NAND flash, ASPs slid 5% q/q with bit growth of 37% q/q, according to the company. (Digitimes)

Xilinx F3Q10 - rev, EPS beat; sees Q4 rev ahead: For the quarter, the chip maker posted rev of $513.3m (+24% q/q, +12% y/y), ahead of cons $491.7m. Diluted EPS of 38c beat cons 35c. For F4Q10, it sees rev ranging from down 1% to up 3% sequentially; that implies a range of $508.2m to $528.7m, ahead of the Street at $492.8m. (TechTrader)

Inotera 4Q09 - revises capex up to NT$52b: Inotera saw net profits of NT$475m on revenues of NT$12.75b in 4Q09. Inotera has revised upward its 2010 capex to NT$52b from an original goal of NT$45b, according to the company. The DRAM producer aims to migrate all of its 12-inch production (130,000 wafers per monthly) to Micron Technology's 50nm stack by the end of the year. (Digitimes)

Nanya 4Q09 - retains 2010 capex at NT$19b: Nanya reported rev of NT$16.69b (US$523.4m) and generated net profits of NT$211m, attributed to a sequential 44% rise in DRAM ASPs. Nanya said its capex budget for 2010 remains unchanged at NT$19b, up from NT$14.6b allocated in 2009. The DRAM producer aims to convert all of its 12-inch chip production to 50nm and start ramping up its output of 2Gb DDR3 chips in 2Q10. Nanya also noted it has kicked off joint development of 42nm stack technology with Micron Technology, and expects to conduct pilot runs in 2H10. (Digitimes)

Rexchip 4Q09 - says two-thirds of estimated US$378m capex to be used to buy immersion tools: Rexchip Electronics, a 64%-held subsidiary of Elpida Memory, has announced that net profits for 4Q09 amounted to NT$3.5b (US$110m). Market watchers have estimated Rexchip's net profits for 1Q10 to reach NT$4b, and profits for 2010 will exceed NT$10b.Rexchip, which produces DRAM chips based on Elpida's designs, aims to convert all of its 12-inch chip production (80,000 wafers a month) to 40nm process technology by the end of 2010. Two-thirds of Rexchip's 2010 capex will be used to buy immersion scanner tools, Chen said. Chen was quoted in previous reports saying the company's capex budget will be as much as NT$12b (US$378m) this year. (Digitimes)

PSC 4Q09 - says majority of capex will be used for immersion tools: PSC swung to net profits of NT$1.6b (US$50.3m) in 4Q09, compared to losses of NT$4.3b in 3Q09 and NT$25.5b in 4Q08. Eric Tang, spokesperson for PSC, said the company is still evaluating its capex plan for 2010. The majority of PSC's 2010 capex will be used to buy immersion lithography equipment for 40nm-class process technology. Tang noted PSC expects to start producing DRAM chips using Elpida's 45nm in the second half of 2010. (Digitimes)

LG Display 4Q09 - rev up, but profits down: LG Display has reported unaudited consolidated revenues of 6.08t won (US$5.4b) for 4Q09, up 2% from 5.97t won in 3Q09 and up 46% from 4.16t won in 4Q08. Operating profit was 357b won, down from a profit of 904b won for 3Q09, but up from a loss of 288b won a year earlier. On a revenue basis, TFT-LCD panels for TVs, monitors, notebook PCs and handset applications accounted for 56%, 23%, 17% and 4%, respectively, in 4Q09. 4Q09 capex was 1.32t won. (Digitimes)

22/01/2010

ST-Ericsson Q4 in line: ST-Ericsson reported 4Q09 flatish revenues of $740m (+2% q/q, flat y/y on pro-forma basis), which is in line with the usual seasonality. On an adjusted basis (excl. restructuring $27m worth amortization), operating loss narrowed to $50m (vs. loss of $77m in 3Q09). Inventory continued to decline, albeit at a slower pace, down by $33m to $244m at end of 4Q09. In terms of outlook for Q1, ST-Ericsson the company expects the usual market seasonal decline (ST-Ericsson).

Western Digital F2Q10 - rev, EPS blows past ests; robust Q3 outlook: Western Digital posted rev of $2.6b (+43.7% y/y) and EPS of $1.85; the Street had been expecting $2.35b and $1.36. The company shipped 49.5m units in the quarter. WDC finished the quarter with $2.4b in cash. The company said gross margin in the quarter was 26.2%, well ahead of its financial model, and up from 15.9% a year ago. It said it sees March quarter rev of $2.45-2.6b, with EPS of $1.45-$1.55; the Street has been expecting $2.21b and $1.12. (TechTrader)

AMD 4Q09 - tops ests; sees Q1 revs down seasonally; to stop consolidating GlobalFoundries: AMD posted 4Q09 rev of $1.646b (+18% q/q,+42% y/y) ahead of cons $1.49b, excluding a gain on the company’s settlement with Intel, the company lost 5c, less than cons of 18c. AMD also said that effective with the first quarter results, it will no longer consolidate the results of GlobalFoundries, and instead account for the unit on the equity method. AMD said it expects Q1 revenue to be “down seasonally.” The Street has been looking for revenue of $1.39b for the quarter. (TechTrader)

Fairchild 4Q09 - rev, EPS beat; Q1 rev upbeat on strong demand: Power semi firm Fairchild Semiconductor posted 4Q09 rev of $354.5m, with adjusted EPS of 23c; the Street has been expecting $340.9m and 17c. Adj. GM was 30.3%,(+340bps q/q, +380bps y/y). Fairchild CEO Mark Thompson on Thursday said sales were up 7% q/q in "what is typically a flat quarter" as the company reduced inventories internally and in its distribution channels. "Order rates were solid throughout the quarter across a broad range of end markets enabling us to increase our backlog" from the prior quarter, he added. For 1Q09, Fairchild sees rev of $370m vs. cons $335.8m due to strong demand virtually across all markets, with adj. GM in the 31%-32% range. (TechTrader, WSJ)

North American Dec chip-gear orders rise 9%: SEMI said that preliminary 3-month average billings for Dec 2009 were $842.2m while the bookings were $863.3m (+9% m/m, +50% y/y), leading to a book-to-bill ratio of 1.03. "Semiconductor capital equipment bookings and billings continued steady growth into Dec 2009," said SEMI. (Reuters)

Japan chip equipment book-to-bill reaches 1.30 in Dec 2009: SEAJ said that preliminary 3-month average billings for Dec 2009 were 59.56b yen (+4% m/m, +22% y/y) while the bookings were 77.39b yen (+10.5% m/m, +127% y/y), leading to a book-to-bill ratio of 1.30. (Digitimes)

Xilinx qualifies 40nm FPGAs at UMC: UMC and Xilinx have jointly announced production qualification for Xilinx' FPGA products built using UMC's 40nm logic process technology on 12-inch wafers. Xilinx' Virtex-6 FPGA family has been fully qualified at UMC's 12-inch fab in Taiwan, following the foundry partner's first delivery of 40nm devices in Mar 2009, according to their joint statement. The Xilinx and UMC engineering teams were able to beat the tape-out to production duration of the Virtex-5 family by a quarter. Six out of nine Virtex-6 family base devices are currently shipping, said Xilinx, adding that all nine are scheduled to be available in production volumes by the end of 2Q10. (Digitimes)

STMicro raises PWM IC quotes, sources say: STM has raised quotes of power management ICs by about 5%, according to sources with Taiwan-based IC distributors. The increased quotes target small-scale customers, while Quanta Computer, Compal Electronics, Wistron, Foxconn Electronics (Hon Hai Precision Industry) and Pegatron Technology will not be affected in the meantime, the sources pointed out. Power ICs from STMicroelectronics remain in short supply, and the shortage may not ease any time soon, added the sources. (Digitimes)

Emulex F2Q10 - rev, EPS beat ests and guid; stable outlook: Storage networking company Emulex posted F2Q10 (ended Dec) rev of $108.3m, ahead of of the Street at $104.1m, and above the company’s preliminary results of $107-108m. Non-GAAP EPS of 18c topped the Street at 16c, and the pre-announced level of 16-17c. For the Mar quarter, the company sees rev of $100-103m and non-GAAP EPS of 16-18c; the Street had been looking for $100.3m and 14c. (TechTrader)

Synaptics F2Q10 - rev, EPS beat; Q3 guid disappointing: Touch-screen display firm Synaptics posted F2Q10 (ended Dec) rev of $133.3m, down 6% from a year ago, but up 11% sequentially, and ahead of the Street at $131.3m. Non-GAAP EPS of 62c beat the Street by 6c. But the company’s guidance for Q3 proved disappointing. The touch-screen display company sees rev for the March quarter of $110-115m, which would be 9%-14% above a year ago, but below the Street at $119.6m. For the June 2010 fiscal year, the company sees revenue of $495m to $505m; the Street has been anticipating $502.6m. (TechTrader)

25/01/2010

Infineon's Wucherer expects to be chairman -paper: German electronic chipmaker Infineon's director Klaus Wucherer does not expect UK pension fund Hermes will be able to stop his election as chairman of the supervisory board on Feb. 11, he told German newspaper Die Welt. Supported by several other investment funds, Hermes is campaigning for ZF Friedrichshafen finance chief Willi Berchtold to head the Infineon board whereas Chairman Max Dietrich Kley wants long-serving board member Wucherer to replace him. In an interview with FT, Wucherer said he would look to meet the investors who have spoken out against his proposed appointment, possibly as early as this week. Infineon needs to achieve an operating profit margin of over 10 percent in its business fields, Wucherer said. "The restructuring is not yet complete, we need to be leaner and reduce our costs," he continued, adding that Infineon could continue to manufacture in Germany if the company retains an innovative edge. (Reuters)

Rambus patents violated by Nvidia, ITC judge rules: A US ITC judge ruled today that Nvidia is violating three patents owned by Rambus. The decision could result in a ban on imports of certain Nvidia chips and products that use them, Bloomberg reports, including some computers made by HP and a host of other PC and graphics card companies. In a statement, Rambus confirmed that the judge issued an initial determination finding that three of five patents Rambus asserted against Nvidia are “valid, enforceable and infringed.” The judge found no violation of the other two patents. The company notes that the case can be appealed to the full ITC, which can affirm, modify, reverse, set aside or remand all or part of the decision. (TechTrader)

ARM-based CPUs will overtake x86 in ultra-mobiles in 2013, says ABI Research: While an estimated 90% of ultra-mobile Devices (UMDs) shipped in 2009 were based on an x86 processor architecture, the introduction of ARM-based systems introduces greater choice and differentiation for system vendors, according to ABI Research, which has forecast annual UMD shipments of netbooks, MIDs, smartbooks and UMPCs based on ARM instruction sets will overtake x86-based devices in 2013. The important netbook segment of the UMD market is now moving into its second generation, and a growing number of netbooks based on ARM platforms are now appearing in the market, helped by the perception that ARM-based systems are heavily oriented towards an "always connected" mode of operation. (Digitimes)

Chip equipment set for strong rebound in 2010, says iSuppli: Global spending on semiconductor manufacturing equipment is expected to rise by 46.8% in 2010 compared in 2009, bringing an end to three consecutive years of decline, according to iSuppli. The sector is set for a strong recovery in 2010, benefiting from the chip industry's deft capacity management in 2009. With chip makers having cut capacity to adjust to changing market conditions, utilization increased 44.9% q/q to 69% in 2Q09. Utilization rose another 15.9% in 3Q09 to reach 80%, and held steady at that rate in 4Q09. iSuppli anticipates that manufacturing run rates in 2H10 will continue to drive up total factory utilization. The utilization rate is expected to peak at 87% in 3Q10 before declining slightly to 86% in 4Q10. Spending in support of memory manufacturing is seen up 65.5% this year. (Digitimes)

MediaTek sales remain strong in 1Q10: MediaTek's rev for 1Q10 are expected to stay flat or drop less than 5% from 4Q09 as China's handset customers continue to place orders to meet the Lunar New Year demand, according to the company. Market watchers expect the company to see revenues surpass NT$10b (US$313m) or even reach NT$11b in Jan, up about 20% on month. Its Q1 rev is likely to reach NT$28-29b, similar to the sum of NT$29.1b for 4Q09, the sources noted. MediaTek is expected to ship more than 10m 3G TD-SCDMA chips in 2010, an about five-fold growth compared to 2009, and its shipments of 3G WCDMA chips will even increase 10 times, the sources added. (Digitimes)

26/01/2010

Texas Instruments Posts Beat-And-Raise Q4 Texas Instruments reported stronger-than-expected Q4 results, posting revenue of $3.005bn (cons $2.98bn) and profits of 52c (cons 49c) per share. Revenue was up 21% from a year ago, and 4% sequentially. For Q12010, TXN sees revenue of $2.95bn to $3.19bn, with profits of 44-52c a share; consensus is at $2.83bn and 43c. TI expects 1Q10 sales to grow -2 to +6% seq (typical seasonality: -8 to -18% seq) as it sees its customers trying to get some inventory in place given constrained supply chains in 4Q09. It noted that 4Q09-end channel inventory has remained flat seq. and stands at its lowest levels historically (techtrader).

Apple's profits jump 49% on While Apple handily beat consensus forecasts, surprise comes from miss in iPhone unit shipments - 8.7m versus consensus of 8.8-10.0m. Apple posted revenue of $15.68bn and EPS of $3.67 a share. The adoption of the new revenue accounting standard makes the results difficult to compare to consensus, which was for $12.06bn and $2.07 a share. While, PC and iPod channel inventory remains lean, Apple noted increasing constraints in component availability — DRAM looks to be constrained besides HDD shortages particularly in 3.5” (desktop drives). HDD makers, Seagate and Western Digital, have also noted shortages in the channel (techtrader).

Boost for Infineon investor revolt The shareholder revolt against Infineon's chairman-designate received a huge boost yesterday when RiskMetrics, the US investor advisory group, threw its weight behind the campaign. In a letter sent to RiskMetrics' clients yesterday, the advisory group recommended supporting a counter-candidate to head the German chipmaker at the annual meeting on February 11. Hermes, the UK activist fund manager, has demanded a "fresh start" at the German chipmaker. RiskMetrics' support can be crucial in a proxy fight, as the group's recommendations are widely followed by a large number of investors at blue-chip companies (ft.com).

Taiwan DRAM makers see delays in immersion litho delivery Growing lead times for immersion equipment is likely to interrupt Nanya and Inotera’s technology transition to sub-50nm in 2010. Rexchip which expects to begin equipment move-in in February, may also see a delay in the delivery of about two months. Nanya and Inotera have clarified that orders for immersion lithography tools are fulfilled in installments. They claimed the deliveries already move were all on schedule. Nanya and Inotera are on track to complete their technology conversions to Micron Technology's 50nm stack by the end of 2010, and expect to begin pilot runs for 40nm-class chips in the second half of the year. Rexchip Electronics is scheduled to start using 45nm processing to produce DRAM in the second quarter of 2010 (digitimes).

SSD market to grow at 54% CAGR by 2013, says IDC SSD shipments grew 14% to surpass 11m units in 2009, according to IDC. Shipments are expected to achieve a CAGR of 54% over the 2008-2013 period. IDC believes that the largest market opportunity for SSDs will be in PCs as an alternative to an HDD in a traditional notebook and in offering a low-cost storage alternative for use in mini-notebooks. In the enterprise, IDC believes that SSDs complement HDDs for certain applications. The desire for increased performance, better utilization, faster access times, and lower power consumption is providing an opportunity for SSD-based solutions in the datacenter where there is a premium on high performance (digitimes).

Foxconn receives orders for 5 million LCD TVs from Samsung, says paper Foxconn Electronics (Hon Hai Precision Industry) has received OEM orders for five million LCD TVs from Samsung Electronics recently, according to a Chinese-language report on Economic Daily News (EDN).

Nvidia violated three Rambus patents In an initial determination, the US International Trade Commission judge ruled on Friday that graphics chipmaker Nvidia has violated three patents belonging to Rambus. Nvidia was cleared of infringement by the ITC judge on two other Rambus patents under examination, however. The litigation involves memory controllers — which handle communications between memory chips and other silicon — related to graphics processors (zdnet).

MIPS appoints former Cavium exec as CEO: Processor intellectual property licensor MIPS Technologies Inc. has announced the appointment of Sandeep Vij as president, chief executive officer and director, replacing interim CEO Anthony Holbrook who will continue to serve as chairman (eetimes).

Apple Tablet: Microsoft Plans Counter Strike: Microsoft will likely attack the tablet market through hardware partners like Hewlett-Packard and Acer, rather than introduce a Microsoft-branded device. Microsoft has not announced release dates or prices for tablet PCs, company executives have left little doubt that Windows-powered tablets are coming. "We started with desktops and laptops, but we added notebooks, now we're adding tablets," said MS Devices division president R. Bach. Microsoft may have a leg up in the tablet market in that its current OS, Windows 7, features built-in support for the touch screen capabilities that are mandatory on tablets. (information week).

27/01/2010

STM Q4 results beat on all 5 key metrics. 1) Q4 revenues were 5% ahead of consensus. 2) The Q4 gross margin came in 50bp ahead of consensus. 3) Adjusted EPS was $0.04 versus consensus of $0.02 in spite of higher tax charges and currency having a negative impact. 4) The Q1 seq. top line growth guidance is about 1.5% percentage below seasonality, but about $34m ahead of consensus in absolute terms. 5) The Q1 gross margin guidance is 300bp ahead of consensus estimates at 37.5% (STM).

Altera 4Q09 - rev, EPS beat: sees Q1, rev above ests: FPGA maker Altera posted 4Q09 rev of $365m vs. cons $334.88m and EPS of $0.34 vs. cons $0.29, thanks to sales in newer markets such as China and improving consumer demand. Altera said it expects a gross margin of 67.5% to 68.5% in 1Q10, exceeding cons 67.42%. Additionally, the company expects Q1 rev to grow 5% to 10% q/q, also exceeding cons $338.53m. (Reuters)

RF Micro Q3 profit beats estimates on lower expenses: Chipmaker RF Micro Devices posted F3Q10 (ended Jan 2) rev of $250.3m below cons $251.6m and adj. EPS of 14c vs. cons 12c. For the fourth quarter, the company forecast revenue from its cellular products group to be better-than-seasonal, while revenue from its multi-products group is expected to be flat to up sequentially. (Reuters)

Integrated Device Technology Q3 beats estimates: Integrated Device Technology posted F3Q10 rev of $142.5m vs. cons $140.5m and adj. EPS of 10c vs. cons 9c. It sees Q4 rev of $132-138m vs. cons $134.4m. The revenue outlook does not consider Integrated Device's Micro Networks business, which it divested in Nov, and revenue from the Tundra design services business, it said. The company forecast revenue from its communications segment to be roughly flat and its enterprise computing segment to be slightly lower q/q. It also expects its consumer segment to see a 10% q/q decline. (Reuters)

QLogic F3Q10 - rev tops guidance: QLogic posted results for F3Q10 (ended Dec 27) which were slightly better than the pre-announcement the company provided earlier this month. Revenue was $149.1m, a bit ahead of the guidance range of $147-149m. Non-GAAP EPS of 31c was likewise ahead of the recent guidance of 29-30c. (TechTrader)



28/01/2010

STM, Buy, Earnings Review/Sales Analysis - IMS key for profitability, gunnar.plagge@nomura.com, STMicroelectronics - Earnings Review/Sales Analysis - IMS key for profitability
Investment Conclusion
Following a reassuring set of Q4 results (that beat expectations on all 5 key metrics that we look at) we have increased our EPS forecast by 60% in the current year, 2% next year and 8% in 2012. We are now forecasting STM to achieve an adjusted operating margin of 4.2% in the current year reaching 9.3% in 2012 (at the lower band of STM's medium-term operating margin target range of 9%-12%). We highlight that our margin model continues to rest on STM's IMS division (comprising STM's very attractive standard product portfolio of analog, power devices, microcontrollers, discrete products, non-volatile-memory and smartcard ICs) which we have highlighted in our note. For IMS we are forecasting an operating margin of 14.1% in 2012, which is in line with historical dynamics. With STM trading on 8.5x2012E P/E (12.2x 2011E), we believe the valuation is attractive. Our price target is EUR 7.6

Summary
• Q409 results review
• IMS: profitable and growing
• Change of estimates

Qualcomm F1Q10 - rev in line, EPS beat; Q2 & FY outlook disappoints: F1Q10 sales $2.7b vs. cons $2.7b; EPS 62c vs. cons 56c. F2Q10 rev seen at $2.4-2.6b vs. cons $2.75b, Q2 EPS 49-53c below cons 57c. FY2010 sales of $10.4-11b vs. cons $11.1b, FY EPS of $2.10-$2.30 vs. cons $2.26. (TechTrader)

TSMC posts biggest profit in 2 years: TSMC booked a net profit of NT$32.67b ($102m) for the Oct-Dec quarter, more than double the year-earlier figure and up 7% q/q. "As the global economy gradually recovered, the fourth quarter saw a continued improvement in wafer sales with computer-related applications growing strongly," TSMC said in a statement, in which it released its quarterly results. (Reuters)

Infineon chairman-designate promises to step down early: Investors agitating for change at the head of Infineon on Wednesday scored an important victory when they forced the chipmaker’s chairman-designate to promise to step down early. Klaus Wucherer, Infineon’s choice for chairman and a current non-executive director at the struggling chipmaker, offered to serve only one year instead of five if elected as chairman. Hans Hirt, head of European corporate governance at Hermes, welcomed Mr Wucherer’s offer but said the investors would carry on the fight until their candidate – Willi Berchtold, the finance director of one of Germany’s largest private companies – gained a seat on Infineon’s board at the annual meeting. (FT)

STM holds iPad brand patent – paper: STMicroelectronics has a registered patent on the iPad brand which it filed with the European Union in September 2000 and which was accepted a year later, French daily La Tribune reported, without citing anyone. (Bloomberg)

Flextronics F3Q10 – rev, EPS edge ests; Q4 outlook broadly in line: Contract electronics manufacturer Flextronics posted rev of $6.5b and profits of 17c; the Street had expected $6.3b and 15c. For FY Q4, the company expects rev of $5.8-6.2b and profits of 13-16c; previous cons was $5.9b and 13c. (TechTrader)

LSI 4Q09 - rev, EPS beat; sees Q1 rev above cons: storage and semi firm LSI posted 4Q09 rev of $638m and non-GAAP EPS of 18c; that beat the Street at $631.5m and 11c. For Q1, the company sees $590-620m in rev, and non-GAAP EPS of 4-10c; the Street has been expecting $580.1m and 6c. (TechTrader)

Lam Research F2Q10 - rev, EPS top ests; upbeat Q3 guid: Fab tool vendor Lam Research posted F2Q10 (ended Dec) rev of $487.2m and profits of 54c, compared with the Street consensus of $453.6m and 40c. The guidance was even better: for the March quarter, it sees rev of $620m and profits of 80c, while the Street had been looking for $481.9m and 50c. (TechTrader)

Teradyne 4Q09 - rev in line, EPS beat; upbeat Q1 guid: For Q4, the Semi Equipment firm posted rev of $267m and non-GAAP EPS of 17c; the Street had expected $267m and 15c. For the March quarter, the company sees rev of $290-310m and EPS of 20-26c; the Street view was $268.7m and 13c. (TechTrader)

LG Display to supply displays for iPad, says WSJ: Flat-screen maker LG Display has received a large volume order for displays used in Apple’s tablet-style device called the iPad, a person familiar with the situation said Thursday. "Apple may not have many other vendors," the person said (WSJ)

Intersil 4Q09 - rev, EPS beat; upbeat Q1 forecast: Intersil reported Q4 revenue of $177.7m, and EPS of 18c, ahead of the Street at $175.1m and 16c. Likewise, the company sees Q1 revenue of $180-187m and profits of 18-20c, ahead of the Street at $167.9m and 15c. (TechTrader)

29/01/2010

Infineon strong Q1 and raised outlook: IFX raised the Q12010 revenue guidance on Dec. 22 towards high single digit growth. Today IFX reported 10% seq. rev growth. In December the company also raised the Q12010 segment margin guidance towards high single digit and IFX reported 9.4% today. IFX is the raising the FY revenue guidance to 'in excess of 20%' (~18% for consensus) and the FY segment profit to 'high single digit'. For Q2 (March quarter) the company is expecting seq. revenue growth towards flat to slightly down, with a high single digit margin (Infineon).

TSMC says capex to reach US$4.8b in 2010: an increase of 79.7% from US$2.671b spent in 2009. Its previous record capex was US$3.3b allocated for 2000. TSMC's capex goal for 2010 has also beat market watchers' estimates of US$4-4.5b. Company CFO Lora Ho indicated 94% of the budget will be used to expand advanced technology capacity, 3% for mainstream processes and the remainder for new business investment. Ho also revealed TSMC's plans to ramp its overall capacity at 12-inch (300mm) wafer fabs by 34% in 2010. TSMC also disclosed that gross margin contributed by its 40nm process is expected to reach the company's overall level at the end of 2010. TSMC posted a 43.7% gross margin for 2009, compared to 42.5% for 2008 and 44.1% for 2007. TSMC chairman and CEO Morris Chang remarked that the global wafer foundry market is set to grow 29% in 2010, with the growth outpacing the overall chip sector's 18% increase. Chang forecast that TSMC's 2010 rev will expand more than 30% to NT$400b (US$12.5b), beating its 2008 record of NT$333.16b. Chang also provided TSMC's estimates for worldwide PC, handset and consumer electronics shipments, which will see growth of 14%, 12% and 7% respectively in 2010. (Digitimes)

Elpida sees first net profits in nine quarters: Computer-memory chipmaker Elpida Memory has reported net profits of 21.1b yen (US$234m) for fiscal third-quarter ended Dec. Revenues grew 57.5% q/q to 151b yen. Elpida said higher DRAM prices boosted its ASP by 30% q/q, and by 60% y/y. It also saw DRAM bit shipments grow 30% q/q, beating the company's guidance of 10-15% growth. As a result of higher shipments and ASPs, sales of Elpida's DRAM line for servers and PCs rose considerably to account for about 80% of the company's net sales in the fiscal third quarter, compared to just under 70% in the July-Sep quarter. Elpida said its DRAM line for mobile phones and digital consumer electronics, which accounted for about 20% of its fiscal third-quarter revenues, registered a slight shipment decrease on quarter due to seasonality. Looking into the final quarter of the company's fiscal 2009, Elpida expects bit shipments to increase 0-5% q/q. Bit growth for the year ended March 31, 2010 is estimated at over 50% y/y. (Digitimes)

SanDisk 4Q09 - rev beat, EPS blows past ests: The flash memory card company reported revenue of $1.24b and non-GAAP profits of $1.16 a share; the Street has been expecting $1.18b and 69c. Revenue was up 44% from a year ago, and 33% from the September quarter. (TechTrader)

KLA-Tencor F2Q10 - rev, EPS edge ests; sees Q3 in line: Chip-equipment maker KLA-Tencor posted Q2 rev of $440.35m vs. cons $438m and adj. EPS of 28c vs. cons 27c. KLA forecast Q3 orders to be flat to up 20% q/q, with rev between $450m and $480m vs. cons $472.1m and adj. EPS of 31-37c vs. cons 34c. CEO Richard Wallace said cost cutting efforts would prove helpful in the coming year. He reiterated that the prevailing view was that semiconductor equipment demand would grow 50% to 60% in 2010 after recessionary under-investment. (Reuters)

Samsung Elec bullish on TV, chip demand in 2010: Samsung Electronics expects rapidly recovering demand for its premium computer memory chips and flat screen TVs to drive growth this year, with the unwinding of global stimulus measures the key risk for sales. It was confident demand for its memory chips and TVs would grow briskly, but warned that the possible end to worldwide government stimulus spending and a rising won currency could hurt. (Reuters)

Maxim Integrated Products F2Q10 - rev, EPS beat; upbeat rev outlook: Maxim posted revenue for its fiscal second quarter ended December 26 of $473.5m, with non-GAAP profits of 24c; that beat the Street at $473.3m and 18c. For Q3, the company sees revenue of $500m to $520m, well ahead of the Street at $448.8m. (TechTrader)

Worldwide PC processor shipments rise 31.3% on year in 4Q09, says IDC: Worldwide PC processor shipments in 4Q09 rose modestly q/q, but still achieved all-time record levels for a single quarter, according to IDC's latest PC processor study. Notably, when compared to 4Q08, shipments rose 31.3%. For the full year 2009, total PC processor shipments grew 2.5%, while revenues declined 7.1% to US$28.6b. (Digitimes)

1/02/2010

Infineon, Neutral, Change of price target - good execution, Dr. Gunnar Plagge, gunnar.plagge@nomura.com, Infineon: Change of price target - good execution
Investment Conclusion
Infineon reported a strong set of Q1 numbers driven by the automotive and industrial/ multimarket divisions. With semiconductor fundamentals expected to remain very solid and strong operating leverage, we have substantially increased our earnings forecasts. However, with 85% of the company's profits expected to continue to come from non-wireless areas and continued fundamental questions about the company's wireless positioning (eg, with regard to application processors, LTE roadmap, customer revenue diversification in 3G), we look at Infineon mainly from an automotive and power semiconductor perspective. We arrive at our price target of EUR4.5 valuing Infineon on 0.7x forward EV/sales, more aligned with the US power & discrete semiconductor segment.
Summary
• Q1 results review
• Change of estimate

Samsung 2009 profits jump, upbeat on memory and TV outlook: Samsung Electronics, the world's top memory and LCD panel maker, has announced net income for 2009 soared 75% to 9.65t won (US$8b) while revenues grew 23% to 89.77t won. Samsung said a replacement cycle for PCs will buoy demand for DRAM chips throughout 2010, and the TV panel business is also another driver for its revenues this year. Samsung swung to net profits of 3.05t won in 4Q09, with its semiconductor business (memory and system LSI) generated operating profits of 1.56t won (+44% q/q). Profits for all of 2009 amounted to 2.15t won. Rev from the chip division totalled 21.79t won in 2009 (+23% y/y). For the memory segment, Samsung saw sales grow 18.9% to 13.77t won in 2009. Looking into 2010, Samsung said DRAM demand will be spurred by better-than-expected PC shipments in the first quarter despite seasonality. Samsung also expects stronger-than-expected NAND flash sales during 1Q10, as supply is still limited amid growing demand for smartphones and other new applications. (Digitimes)

Toshiba falls on weak outlook: Toshiba fell the most in nine months in Tokyo trading, after the company cut its annual revenue forecast. Toshiba on Jan. 29 cut its annual sales forecast 5.9%, citing a global recession that’s more “persistent” than the company had anticipated. Revenue will be 6.4t yen ($71b) in the year ending March 31, said the Tokyo-based company. That compares with the 6.8t yen it had previously predicted. Toshiba maintained its projections for an annual net loss of 50b yen and an operating profit of 100b yen. (Bloomberg)

Creditors Extend Hynix Stake-Sale Deadline: Korea Exchange Bank said Monday the creditors of Hynix Semiconductor have extended the deadline for accepting bids for their stake in the chip maker to Feb. 12. It also said it expects companies to participate "actively" in the bidding process. Creditors of Hynix failed to receive any bids for the stake by a Friday deadline. A lack of bidders could test South Korea's willingness to allow the stake to be sold to foreign investors as part of its drive to shed assets acquired by state-controlled banks and other friendly institutions following bailouts. (WSJ)

GlobalFoundries aims for 30% of chip-foundry market in 3 years: GlobalFoundries aims to account for 30% of the made-to-order chip market within three years, its largest investor said. “Am I setting very aggressive targets? Yes,” Ibrahim Ajami, CEO of Advanced Technology Investment Co. (ATIC), GlobalFoundries’ controlling shareholder, said in a Jan. 28 interview in Abu Dhabi. “We need to be a $5bn company in the next two to three years.” A 30% share would take GlobalFoundries past UMC, making it the world’s second-largest contract manufacturer of chips after TSMC. ATIC has no interest in acquiring either UMC or South Korea’s Hynix Semiconductor, Ajami said. “It doesn’t fit with our strategy right now,” he said. “UMC is another foundry in Taiwan and we’re not looking to go there right now and Hynix is a memory company. Memory is not what we’re focused on right now.” (Bloomberg)

Samsung says it has developed 30nm DRAM: Samsung Electronics announced Monday that it has developed the world's most advanced DRAM chip with 30-nanometer technology. The company said the 30-n process technology, when applied to DDR3 mass production, could raise productivity by 60% over 40-nm DRAM chips, while it reduces power consumption by up to 30% over 50-nm class DRAM chips. The new technology is slated to go in mass production beginning in 2H10, which expects to be applied to a broad range of products including servers, computers, and mobile devices, Samsung added. (Bloomberg)

DRAM revenue up 42% in Q4: On the heels of 40% sequential revenue growth in Q3 2009, worldwide DRAM revenue grew another 42% in Q4 2009 climbing to $8.682b, according to the latest data from DRAMeXchange. The market researcher attributed the December quarter growth to hiking ASP (average selling prices) for DRAM, output enhancement, and improving PC sales. “DDR2 still remained its mainstream memory standard in Q4. That demand is much stronger than DDR3 since demand for middle/entry level models looks good. That is, DDR2 shortage happened in Q4 and resulted in the up climbing DDR2 contract price in October and November, as well as stable pricing level in December. Based on a DRAMeXchange check, DDR2 average contract price had sharply raised 61% in Q4, while spot price also climbed 68%.”(EE Times)

AUO increases capex to NT$100b in 2010: Display firm AU Optronics has increased its capex by 64% to NT$100b (US$3.13b) for 2010, up from NT$61b in 2009. Up to 85-90% of the capex will mainly go towards expanding 7.5G and 8.5G capacities, with the remaining 10-15% allocated for its solar energy business, according to the company. (Digitimes)