Circuits Assembly Online Magazine - White Papers

News

SAN JOSE, Nov. 22 -- The 90-day moving average for orders of semiconductor equipment from North American manufacturers rose 3% over revised September levels and 60% year-on-year, the industry trade group SEMI said today.

Respondents to SEMI's monthly poll posted $1.39 billion in orders in October. The book-to-bill ratio was 0.96, meaning that $96 worth of orders were received for every $100 of product billed for the month.

The three-month average of worldwide billings was $1.44 billion in October, flat with revised September levels and up 67% versus a year ago.

The industry is flux, SEMI said in a statement. "The overall semiconductor equipment sector will post the second greatest gain on record in 2004. It is also several months into a period of order softening," said Stanley T. Myers, president and CEO.

"Total equipment bookings for North American producers have declined 13% from the cyclic peak observed in June. Given recent announcements from several equipment companies, continued moderation in orders is expected until end market visibility strengthens for the semiconductor manufacturers."

SAN JOSE, Nov. 26 -- Worldwide semiconductor sales grew 1.5% to $18.8 billion in October, said the SIA today. The October 90-day average for sales was up 22% over a year ago.

The rise reflected "ongoing inventory corrections in certain market segments," said SIA president George Scalise in a press statement.

SIA guided for fourth-quarter sales to be flat sequentially. The trade group projects year-on-year growth of at least 28%.

October sales of DSPs rose 8.5% sequentially, a sign that the inventory correction that began in the wireless handset market in July has run its course, said Scalise.

PC sales, which historically peak in the fourth quarter, have been further buoyed by corporate demand, SIA said. Microprocessors were up 6.4% sequentially and DRAMs were up 2.8%, signs that the supply chain has shed its excess inventories for those chips, SIA said.

"Sales of consumer electronics are especially strong in the fourth quarter as the holiday build continues," said Scalise.

Capacity utilization declined two points in the third quarter, to 93%. Sales in all geographic regions except Japan were up sequentially in October.

SAN DIEGO, Nov. 24 — West Tech Inc. will represent KIC's full line of automated thermal management tools and systems for reflow, wave, cure and semiconductor thermal processes in Colorado and Utah.

The agreement was announced by the companies today. Other details were not disclosed.

TORONTO, Nov. 24 -- Celestica named John Boucher chief supply chain and procurement officer, responsible for global supply chain strategy and execution, including strategic procurement and commodity management activities.

Boucher will also lead the EMS company's Lean Manufacturing initiatives.

Boucher was head of manufacturing for Celestica in North and South America.

Prior to joining Celestica in March, Boucher was corporate vice president of global supply chain management for MSL, which Celestica acquired. He also worked for Circuit Test Inc. and Digital Equipment Corp.

FRAMINGHAM, MA., Nov. 24 - Factory revenue in the worldwide server market grew at 5.5% year over year to $11.5 billion in the third quarter, the sixth consecutive quarter of growth. Units shipped rose 18.7%, said research firm IDC.
Revenue from so-called volume high-end servers grew 18.2% and continues to drive the server market. Midrange enterprise server sales declined 10.2%, the third straight quarterly decline. High-end enterprise servers grew 1.9%, the forth consecutive quarter of growth.

"IT spending remained strong overall in the third quarter as customers continued to refresh and expand their IT infrastructures," said Matt Eastwood, program director of global enterprise server solutions at IDC. "Although customers continue to target data center simplification initiatives, investment in strategic IT initiatives - including new workloads - are also growing significantly once again."

IBM retained the top spot worldwide with 31.7% market share, up 6.3%. HP, the shipments leader, was second in revenues (26.8% share), up 2.9%. Sun and Dell were third at 10.2% and 10.1%, respectively. Dell grew 14.1% year-over-year while Sun was flat at 0.1%.

Top 5 OEMs, Worldwide Server Systems Factory Revenue (millions)

IBM   $3,659   31.7%
Hewlett-Packard $3,094 26.8%
Sun   $1,176 10.2%
Dell    $1,170 10.1%
Fujitsu/Fujitsu Siemens   $714 6.2%
Others   $1,733 15%

Read more ...

NEW YORK, Nov. 24 -- Top tier electronics manufacturing services providers need to adopt a small business mindset if they are remain viable and profitable companies, says a report issued today by a major consulting firm.
McKinsey & Co. said today that although contract assemblers can leverage economies-of-scale and have generated tremendous value for their customers, "they have proved less adept at capturing value for themselves" and further restructuring awaits unless the sector adopts better habits.

In the McKinsey Quarterly, published today, the firm asserted, "Fierce competition, the economic downturn and an outdated pricing model have combined to produce razor-thin or nonexistent margins for most of the industry's top-tier players. The takeaway EMS players must learn to stand up to their powerful OEM customers, just as suppliers in the automotive industry have done. They can no longer afford to offer generous terms simply to fill up their factories.

"A bright future awaits these companies only if they adopt a small-business mind-set by charging for every service they provide on the OEMs' behalf and by closely monitoring their pricing and collection processes," McKinsey wrote.

Read more ...