Hello again readers! I recently told you about some new functionalities on the ElectroIQ.com website, but that's only part of our redesign work. Looks are important too, and organization even more so.
Very soon, you'll see a lighter color scheme on ElectroIQ.com. We've pared down the blue and red in favor of a cleaner palette on the site, with a lot of grey and white. Does this matter? Not in the strict sense of will the information you're reading, watching, or listening to be affected, but the new color scheme is here to make it easier for you to consume information from ElectroIQ without distractions.
Speaking of paring down, we've also eliminated the barrier between "Current Articles" and "Industry News" that appeared throughout the site. Let's say you're visiting the Semiconductors channel page. you'll see all the more recent stories in one column. Are we abandoning industry news stories, or technical articles about process steps? Certainly not. We've decided to group content with the fewest barriers possible so you can find it more easily.
Another quick note on those channel and topic center pages: We've renamed "Wire News" to "Live News Stream."
As always, you can email me with questions or suggestions at meredithc@pennwell.com. Keep an eye out for our new look!
Your digital media editor,
Meredith Courtemanche
Thursday, December 15, 2011
Tuesday, December 13, 2011
Reading into INTC's 4Q downdate: HDDs, PCs, and SSDs
The impact of the Thailand flooding has, as expected, spread throughout the tech supply chain, and now appears to be affecting even chip giant Intel. The company now says its 4Q11 sales will be about -7% below estimates ($13.4B-$14B, vs. $14.2-$15.2B) due to ramifications from the disaster. Gross margins are seen fractionally lower at ~64.5%. (Barclays' CJ Muse notes that $1B in lower sales, paired with $95 ASPs, suggests 10.5M fewer unit shipments -- which he translates to an -11% decline in 4Q11, instead of previous 1.5% expectations.)
PC sales are still expected to be up sequentially, but inventories are vanishing in the global supply chain as hard-disk drives are increasingly scarce (a big chunk of global HDD production is in the flooding-ravaged areas and has been knocked offline). Intel expects HDD shortages to linger into 1Q12, after which MPU inventories need to be rebuilt through 1H12.
Analysts' Take
Given the breadth of the Thai flooding's industrywide impact (from HDDs to chip packaging services), nobody seems very surprised that INTC is now being affected. Earlier this week IHS iSuppli calculated nearly a 4M unit shortfall in 1Q11 PC shipments as a result of the floods, exacerbating what is already a seasonally slow post-holiday period for PC demand. (The firm says HDD supplies should rebound by 2Q12, though -- and might even achieve oversupply before the year's out.)
Analysts also seem to be more comfortable with where Intel's numbers are relative to (what they believe is) sentiment among the greater PC sector. (Remember how analysts previously tried to overlay PC weakness onto INTC, to no avail?) FBR Research's Craig Berger points out that Intel's been "disconnected from the rest of the PC supply chain for at least a couple quarters," but both he and Barclays' Muse agree that Intel's adjusted outlook is now better aligned with end-market demand, from deteriorating ODM build data to PC demand assumptions to pre-flooding PC sales warnings from Dell and HP.
Muse, Sterne Agee's Vijay Rakesh, and Citi's Glen Yeung await the other shoe to drop for AMD's 4Q11 results (1%-5% expected growth, for now) and 1Q12 outlook (Rakesh is also watching Nvidia.) AMD, though, seems not to be worried about HDD supply issues for now; "In 1Q and 2Q, maybe you see some manifestations," according to new CEO Rory Read, but right now AMD isn't seeing any "major pressure in terms of the quarter."
Others wonder if the HDD shortage is drawing attention away from bigger problems with end-demand. Credit Suisse's John Pitzer suggests 1H12 demand will also be soft due to Windows 8 "anticipatory pause," ongoing worries about ARM competition, plus continued "macro headwinds and the likelihood of another INTC miss." At least the problems would seem to be cyclical and not structural in nature, with PC growth expected to accelerate again in 2Q/3Q12. FBR's Berger sees other warning signs that could pinch PC margins in 2012 (and perhaps trickle down to INTC and other component suppliers): Chinese labor costs (10%-30% higher in 2011, another 30%-50% in 2012); commodity inflation (e.g. gold, Cu, metal casings); and more competition from tablets (iPad et al, assuming 2.5 tablets cannibalize one PC).
If HDD supplies are a problem, is this a window of opportunity for solid-state drives (SSD)? Not really, Intel says; ODMs probably are reevaluating their options as the HDD supply situation evolves, but SSD demand probably won't accelerate until the end of 2012. -- J.M.
PC sales are still expected to be up sequentially, but inventories are vanishing in the global supply chain as hard-disk drives are increasingly scarce (a big chunk of global HDD production is in the flooding-ravaged areas and has been knocked offline). Intel expects HDD shortages to linger into 1Q12, after which MPU inventories need to be rebuilt through 1H12.
Analysts' Take
Given the breadth of the Thai flooding's industrywide impact (from HDDs to chip packaging services), nobody seems very surprised that INTC is now being affected. Earlier this week IHS iSuppli calculated nearly a 4M unit shortfall in 1Q11 PC shipments as a result of the floods, exacerbating what is already a seasonally slow post-holiday period for PC demand. (The firm says HDD supplies should rebound by 2Q12, though -- and might even achieve oversupply before the year's out.)
Analysts also seem to be more comfortable with where Intel's numbers are relative to (what they believe is) sentiment among the greater PC sector. (Remember how analysts previously tried to overlay PC weakness onto INTC, to no avail?) FBR Research's Craig Berger points out that Intel's been "disconnected from the rest of the PC supply chain for at least a couple quarters," but both he and Barclays' Muse agree that Intel's adjusted outlook is now better aligned with end-market demand, from deteriorating ODM build data to PC demand assumptions to pre-flooding PC sales warnings from Dell and HP.
Muse, Sterne Agee's Vijay Rakesh, and Citi's Glen Yeung await the other shoe to drop for AMD's 4Q11 results (1%-5% expected growth, for now) and 1Q12 outlook (Rakesh is also watching Nvidia.) AMD, though, seems not to be worried about HDD supply issues for now; "In 1Q and 2Q, maybe you see some manifestations," according to new CEO Rory Read, but right now AMD isn't seeing any "major pressure in terms of the quarter."
Others wonder if the HDD shortage is drawing attention away from bigger problems with end-demand. Credit Suisse's John Pitzer suggests 1H12 demand will also be soft due to Windows 8 "anticipatory pause," ongoing worries about ARM competition, plus continued "macro headwinds and the likelihood of another INTC miss." At least the problems would seem to be cyclical and not structural in nature, with PC growth expected to accelerate again in 2Q/3Q12. FBR's Berger sees other warning signs that could pinch PC margins in 2012 (and perhaps trickle down to INTC and other component suppliers): Chinese labor costs (10%-30% higher in 2011, another 30%-50% in 2012); commodity inflation (e.g. gold, Cu, metal casings); and more competition from tablets (iPad et al, assuming 2.5 tablets cannibalize one PC).
If HDD supplies are a problem, is this a window of opportunity for solid-state drives (SSD)? Not really, Intel says; ODMs probably are reevaluating their options as the HDD supply situation evolves, but SSD demand probably won't accelerate until the end of 2012. -- J.M.
Thursday, December 8, 2011
ElectroIQ.com is getting a new look
You're going to notice some changes around ElectroIQ.com soon, and may have seen some of them already. We'll be adding new coverage areas, streamlining the topics in each of our "Channels," and revamping the site design for a better user experience. We'll talk about all of these changes here in the editors' blog as we transition through the upgrade.
Our redesign is already underway, as you can see from the new "Translate" functionality on every page. The semiconductor and photovoltaics manufacturing supply chains are global like few other industrial sectors. On top of this, students in the Asia-Pacific, Mexico, Eastern Europe, and other locations are studying engineering. With our parent company, PennWell Corp., the ElectroIQ team hosts and attends tradeshows and conferences from Las Vegas to Shenzhen.
We wanted a translator that was easy to use and included as many languages as possible, so no surprise that we turned to Google. Whether you're on the electroiq.com homepage, reading a news story, or on any other page, you'll be able to set your preferred language, and we'll keep it that way for the duration of your site visit (unless you decide to switch it up).
You can use the Google Translate function now (and let us know what you think), and when the new site design goes live in the next few days, you'll see links to our international publications right along the top of the site. Want to read our in-depth technical magazine content in Chinese? It's all right there for you.
This new design is not a one-day change, and we'll keep you up-to-date on all the new things you'll see come on-line. If you have questions or suggestions, email me at meredithc@pennwell.com.
Your digital media editor,
Meredith
Our redesign is already underway, as you can see from the new "Translate" functionality on every page. The semiconductor and photovoltaics manufacturing supply chains are global like few other industrial sectors. On top of this, students in the Asia-Pacific, Mexico, Eastern Europe, and other locations are studying engineering. With our parent company, PennWell Corp., the ElectroIQ team hosts and attends tradeshows and conferences from Las Vegas to Shenzhen.
We wanted a translator that was easy to use and included as many languages as possible, so no surprise that we turned to Google. Whether you're on the electroiq.com homepage, reading a news story, or on any other page, you'll be able to set your preferred language, and we'll keep it that way for the duration of your site visit (unless you decide to switch it up).
You can use the Google Translate function now (and let us know what you think), and when the new site design goes live in the next few days, you'll see links to our international publications right along the top of the site. Want to read our in-depth technical magazine content in Chinese? It's all right there for you.
This new design is not a one-day change, and we'll keep you up-to-date on all the new things you'll see come on-line. If you have questions or suggestions, email me at meredithc@pennwell.com.
Your digital media editor,
Meredith
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