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More evidence that the chips are down

'It's pretty bad,' warn circuit etchers

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The chip industry today got yet another warning not to expect the market to pick up until next year.

Netherlands-based ASML Holding, which makes machines that etch circuits onto semiconductors, said cancelled orders had forced it to report a loss for the first half of the year.

It added that it didn't expect to see a recovery in the chip industry for a year.

"Let's be very clear about it - it's pretty bad," ASML CEO Doug Dunn told Bloomberg. "Why would our customers buy new equipment when they don't utilise those they already have?"

ASML's customers, which include Intel and ST Microelectronics, have been hit by falling demand for computer chips due to slowing economic growth.

ASML recorded a loss of 96 million euros ($82.8 million), including one-off items, for the six months ended June 30 2001. This compared to a profit of 149 million euros ($128.51 million) for the same period the previous year.

Sales dropped 24 per cent to one billion euros.

Intel yesterday said second quarter net income dropped 76 per cent to $854 million. Sales fell 24 per cent to $6.3 billion. It warned that it expected revenue to remain static in Q3. ®

Related Link

ASML statement
Bloomberg article

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