Chip makers enter slump; sales fall 13%
Article Abstract:
Numerous problems have plunged the semiconductor market, as evidenced from several developments. International chip sales sank to $9.99 billion in May 1998, according to the dominant trade group Semiconductor Industry Association (SIA). The nearly 13% drop from May 1997 represents the lowest monthly sales result since Feb 1995. SIA also projects a 1.8% decrease in 1998 chip sales, following its fall 1997 forecast of 1.7%. By comparison, Pathfinder Research and VLSI Research foresee a nearly 10% decline in 1998 sales. Problems stem from the Asian financial crisis, inventory surpluses and customer demand for less-expensive PCs. Numerous Silicon Valley companies, including National Semiconductor and Cypress Semiconductor, have reduced workforces and projected weaker 2nd qtr 1998 performances. US companies are experiencing some of the strongest downturns, which differs from the 1996 problems that mostly struck Japanese and Korean DRAM vendors.
Publication Name: The Wall Street Journal Western Edition
Subject: Business, general
ISSN: 0193-2241
Year: 1998
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Intel beats lowered earnings forecasts: chip maker issues warning for the current period, plans to cut 3,000 jobs
Article Abstract:
Intel's 1st qtr 1998 income of $1.27 billion, or 72 cents a diluted share, exceeded earnings forecasts but the chip maker cautioned that sagging PC manufacturer demand will keep 2nd qtr 1998 revenue flat to slightly down. The company also said it will eliminate 3,000 jobs, or around 5% of its work force, through Oct 1998 via attrition and layoffs. Intel also plans to reduce $300 million from its $5.3 billion capital-spending budget for 1998. The 1st qtr 1998 results include a $165 million acquisition charge, or nine cents a share. The company announced per-share earnings of 81 cents excluding the charge, compared to analysts's consensus revised from 93 cents to 72 cents. Intel's 1st qtr revenue of $6.0 billion represents a 7% decline from $6.45 billion in the 1st qtr 1997. Analysts interpreted mixed results from the report, but Intel Chmn and CEO Andrew S. Grove blamed the performance on oversupply in the PC industry.
Publication Name: The Wall Street Journal Western Edition
Subject: Business, general
ISSN: 0193-2241
Year: 1998
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Comment about this article or add new information about this topic:
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