Speaker 1: After the bell, we heard from Applied Materials. This is
Speaker 1: the company that basically is the largest manufacturer of chip
Speaker 1: making equipment. It gave a better than feared sales forecast
Speaker 1: for the current quarter. We want to bring into the
Speaker 1: conversation Bloomberg's Ian King. He covers all things semiconductors from
Speaker 1: our studios and bureau in San Francisco. You know, it's
Speaker 1: always a pleasure. What do you make of what we
Speaker 1: had from aim At today? Well, any time a company
Speaker 1: comes into earnings with all of the sort of clouds
Speaker 1: on the horizon and everybody worried about where it's going
Speaker 1: and analyss projecting a contraction and it says, oh no,
Speaker 1: actually we're going to grow. Clearly is going to cause
Speaker 1: some relief. And that's what we've certainly seen today. You know,
Speaker 1: they're arguing very strongly. Hey, look, technology still counts. The
Speaker 1: chip makers need to get better at what they're doing,
Speaker 1: and we're kind of route one to do in that.
Speaker 1: So that's our argument and it's holding up for now.
Speaker 1: I think the elephant in the room, though, is the
Speaker 1: situation with US and China, the Biden administration withholding some
Speaker 1: of this advanced semiconductor technology from the Chinese, and I'm
Speaker 1: wondering whether or not Applied material to address that point.
Speaker 1: We I mean, you've now that it was a giant
Speaker 1: part of what they had to talk to today. They said, look,
Speaker 1: these restrictions that we saw came came in in October
Speaker 1: the seventh are going to cost US two and a
Speaker 1: half billion dollars of lost revenue in this year unless
Speaker 1: the government sort of behaves itself and starts giving some
Speaker 1: of these licenses. And then if we're looking, if everything
Speaker 1: goes okay, might just be do we only lose one
Speaker 1: and a half billion dollars of lost revenue? So can
Speaker 1: you give me a sense of the types of semiconductors
Speaker 1: that may be produced using this equipment and whether we
Speaker 1: can glean anything from what Applied Materials had to say
Speaker 1: about let's say the memory chip market versus microprocessors versus
Speaker 1: some of the chips that are used in phones. Yeah,
Speaker 1: I mean, from a market perspective, memory is obviously in
Speaker 1: big trouble right now, and all of the producers are
Speaker 1: cutting their orders for equipment. Not very good at all.
Speaker 1: Applied said, look, you know that's bad, but guess what
Speaker 1: people who are making logic chips, the kind of processes
Speaker 1: are going to your iPhone or your PC. They're actually
Speaker 1: doing relatively okay, and you know, our orders in that
Speaker 1: particular area are not too bad. So when you look
Speaker 1: at what we heard from in video yesterday, one of
Speaker 1: the leading manufacturers of those graphics processors that are used
Speaker 1: in some of the computer systems where cloud computing is involved,
Speaker 1: also a critical component for the gaming devices, did aim
Speaker 1: at give anything into the graphics chips market. Well, not
Speaker 1: not specifically the graphics chip chip market. I mean, that
Speaker 1: would be advanced logic, but if you throw what goes
Speaker 1: that into the mix overall, the kind of conclusion that
Speaker 1: we've sort of drawing from what's said this week is,
Speaker 1: you know, the big iron, the enterprise systems, the cloud systems.
Speaker 1: If you're selling technology into those markets, or technologies that
Speaker 1: makes technology that goes in those markets, maybe things aren't
Speaker 1: as bad. Maybe this recession concern is overblown. And that's
Speaker 1: what these companies are sort of suggesting. If you sort
Speaker 1: of aggregate what they're saying, consumer and other areas are
Speaker 1: still pretty grim. Where does AMATT measure up in terms
Speaker 1: of how is it measuring up against competitors like K
Speaker 1: l A. Or Land Research or the Dutch company a
Speaker 1: s mL. Yeah, I mean that's a very good question.
Speaker 1: They claim the technologies are allowing them to gain market share,
Speaker 1: but if you look at you know, the revenue forecast,
Speaker 1: they along with Lime Research, are really the ones that
Speaker 1: are getting hurt by this China action, by these trade
Speaker 1: by these you know, these trade restrictions. Um. So you know,
Speaker 1: pluses on one side, minuses on the other. Okay, Ian
Speaker 1: good stuff always a pleasure. Thanks for making time for US.
Speaker 1: Ian King covers the semiconductor industry for US at Bloomberg