Geotest Moves to Irvine; Western Digital Hits the Court
Listening to pundits debate the chip industry’s future is like listening to dueling banjos. For every argument chips soon will come back from their year-long slump, there is an identical argument they won’t.
Only a couple months after the San Jose-based Semiconductor Industry Association came out with a rosy report saying a chip comeback was afoot, Dataquest, a division of researcher Gartner Group Inc., came out with a report saying chips sales would decline 26% to $168.1 billion this year.
“There are few signs of growth in design wins,” Dataquest analyst Mary Olsson said in a statement. “Component prices and lead times are still low, and electronic-system component demand is weak.”
Dataquest says it isn’t certain when chip sales will come back.
Chip prices declined in May and June, and memory prices remains under pressure, Dataquest said. In the analog chip sector, prices have been stable. But lower unit sales have resulted in declining revenue there too.
Of course, this doesn’t bode well for Orange County’s chip sector, which includes both the large,Broadcom Corp., Conexant Systems Inc.,and the small,3DSP Inc., Valence Semiconductor Inc.
But there are some signs of life. Dataquest said that evidence from the Asia-Pacific region indicates that American and European companies are ordering more motherboards,the silicon boards that hold chips,for notebook computers and wireless phones. But the indications aren’t enough to get excited about, and the sector should stay slow for a while.
Stock analysts aren’t coming up with any better conclusions. Goldman Sachs analyst Nathaniel Cohn upgraded Irvine-based Broadcom, Newport Beach-based Conexant Systems and San Diego’s Qualcomm Inc. to the firm’s “recommended list.” But a Lehman Brothers analyst downplayed upbeat comments about the chip sector.
New Test Bed
Geotest-Marvin Test Systems Inc., a maker of testing systems for chips, aerospace, communications and medical products, recently moved from its Santa Ana headquarters to Irvine. The company’s new facility is located at 17570 Cartwright Road.
The move is part of a restructuring plan aimed at making the company more efficient and expandable, according to Geotest.
“Our new headquarters will allow us to expand our research and development, production and sales departments while providing a high-visibility corporate image,” said Chief Operating Officer Loofie Gutterman.
Geotest Marvin Test Systems is a subsidiary of the Marvin Group, which is headquartered in Inglewood.
Go2 Signs Partner
Irvine-based Go2 Inc. recently signed San Francisco-based CustomWeather Inc. as a new partner in the company’s mobile services directory.
Go2 builds and maintains a search engine designed for use through mobile devices, such as wireless phones. Using the search engine, users can perform tasks such as ordering a burger or finding an address. CustomWeather plans to supply forecasts to go2’s users, the company said.
“Go2 is working to make our end users’ mobile experience complete by providing relevant information based on their location,” said go2 Chief Executive Lee Hancock. “CustomWeather’s local data will enhance our location-based services and allow go2 to deliver more pertinent, vital information to our users and enhance our merchants’ ability to help their customers save time and money.”
Gateway’s Bind
Even with a pullback in Europe, San Diego-based computer maker Gateway Inc. isn’t planning to pull out of Lake Forest, where the company has its business computer operations. The company still plans to move to San Diego only 90 people out of the 600-employee workforce the company has in OC.
But Gateway’s plans to reconsider other global operations is a clear sign of a new reality at the company: be profitable or be gone.
“If the company decides that (overseas markets) can’t achieve the goal of being profitable, it might mean significant restructuring or even withdrawal from that particular market,” a Gateway spokesman told CNet Networks Inc.’s News.com.
Sales at Gateway’s business unit declined by 9% in the second quarter vs. the year-ago period, even though unit shipments increased 9%. Chief Executive Ted Waitt has made it clear he wants the company to return to its roots of selling computers to consumers.
Western Digital’s Got Game
Despite reporting a loss last quarter and an ongoing restructuring, Western Digital Inc. recently gave employees something back: a new sand volleyball court and a basketball hoop. The company, which moved from its high-profile Irvine Spectrum digs last year, is getting more at home with the new sporting courts.
The decision to put in the courts follows that of other OC companies that provide employees with on-site amenities, such as Conexant, which has a volleyball court, and Costa Mesa-based FileNET Corp., which has a gym. Western Digital officials couldn’t be reached for comment on the new courts.
