Circuits Assembly Online Magazine - Features

SAN JOSE, Aug. 11 -- Cisco Systems yesterday reported sales grew 26% vs. last year and 5% sequentially in the recently concluded July quarter but warned that sales in the current quarter may fall disappoint the Street.

The maker of telecom and networking gear forecast sales would be flat to up 2% sequentially, and year-on-year growth would slow to 16 to 18%.

For the just completed July quarter, router demand rose 12% sequentially and switches were up 3%. However, the company's ratio of inventories to cost-of-goods-sold (COGS) climbed sequentially, and turns dropped to 6.2, from 6.3.

In a research note published today, Deutsche Bank warned that climbing inventories among OEMs of communications equipment could shake the recovery of the EMS sector. "EMS production rates of communications gear has increased 15% since the Nov./Dec. quarter (normally flat to down 10%). We believe this is largely a result of building inventories at Cisco and other [communications] OEMs (Lucent, Ericsson, Motorola)."

Cisco buys about $4 billion worth of goods and services from North American top tier EMS vendors, according to DB, making it one of the largest EMS customers. Major suppliers to Cisco include Celestica (about 10% of revenue), Solectron (13%) and Jabil (about 15%).

"Cisco`s slowing sales growth and inventory build reinforces our view that the peak of the current tech cycle is near," DB analyst Chris Whitemore wrote.

Weymouth, UK - Aug. 4, 2004 - DEK (dek.com)'s latest machine for surface-mount pre-placement, the Europa, has a cycle time of less than seven seconds and total process Cpk 2.0 of ± 20mm.

According to the company, a newly designed chassis provides torsional and thermal stability and a single natural vibration frequency. A new scaleable control system increases the reliability of dramatically reduced wiring - 40% less than conventional printing systems.

Rich Heimsch, president of DEK International, notes that Europa's specification sheet describes the performance customers can expect during actual production. "Europa's Cpk 2.0 at ± 20mm is the figure for true paste on pad repeatability, measured after a full wet print cycle. Many specifications quote fiducial alignment capability only, but it is paste on pad repeatability that really matters to electronics assemblers."

The machine features an interactive user interface, with graphical indications for consumable replenishment, plus on-board help and error recovery. Its software links to DEK's Web-based support services and contains tutorials on setup, process optimization, and maintenance and applications issues.

TAIPEI, Aug. 11 -- Notebook PC maker Elitegroup Computer Systems will branch into EMS services following a recently completed internal reorganization.

The company is aiming for notebook contract orders from regional vendors and system integrators, DigiTimes reported, sourcing chairman Johnson Chiang.

ECS, one of Taiwan's largest ODM makers of motherboards, recently split into two units -- EMS and brand products.

While the company's history is in motherboard manufacturing, the EMS group will target a broader product range including motherboards, graphics cards, PC systems and notebooks, DigiTimes said.

ARLINGTON, VA, Aug. 9 - July bookings of electronics components slowed for the first time in nearly a year but are expected to pick up in the fall, said a trade group that tracks monthly orders.

Orders flattened in July, their first slowdown in 11 months, reported the Electronic Components, Assemblies & Materials Association, a trade group of component makers and assemblers.

"After almost a year of steady upward movement, the market seems to have taken a bit of a breather in July," said Bob Willis, ECA president, in a press statement. "We suspect that this will be temporary and that growth will resume by the end of this quarter through the close of the year."

Executives from manufacturers who met at ECA's spring conference said they expect growth well into 2005, ECA said.

The ECA is a sector of the Electronic Industries Alliance.

TAMPA, Aug. 4 -- Reptron Electronics reported second-quarter sales of $35.6 million, down about 10% from last year.

For the quarter ended June 30, Reptron recorded a pro-forma loss from continuing operations of $174,000, excluding reorganization expenses. This compares to a $711,000 loss a year ago. The net loss was $147,000, vs. $2 million last year.

Gross margins improved sequentially.

In February, Reptron emerged from Chapter 11 bankruptcy, having sold various assets of its components distribution and memory module divisions.

"Reptron Electronics continued on its road to recovery during the second quarter," said Paul Plante, president and CEO. "We continue to see signs of an improving economy through increasing customer demand."

TAMPA, FL, Aug. 9 -- Reptron Electronics has signed a multimillion dollar contract to build electronics assemblies for Clear-Com Communication Systems.

"This is an important business development for Reptron that increases our capacity to provide manufacturing services for the communications industry sector," said Bonnie Fena, president of Reptron Manufacturing Services.

Full production is expected to ramp by the end of 2004.

Under the deal, Reptron will build 150 different subassemblies and PCBs for wired and wireless intercommunications products. Much of the current phase involves converting from plated through-hole to to surface mount technology.