OC Semis Put Up Good Numbers Amid Forecast-Cutting
STM Opens Miami Office to Boost Latin American Sales; Mind Gets Funding
TECHNOLOGY by Andrew Simons
Orange County chips are up. It’s hard to believe everyone seems so down.
Look at the top two.
Irvine’s Broadcom Corp., the county’s largest chipmaker, reported a narrowing operating loss of $23.6 million in its June quarter, down from $57.6 million a year ago. Broadcom’s sales jumped 22% to $258.2 million vs. last year’s quarter.
Newport Beach-based Conexant Systems Inc., OC’s second largest chipmaker, saw $154 million in sales from continuing operations in its June quarter, a sequential increase of 3.5%. Conexant’s pro forma operating loss from continuing operations for the most recent quarter was $53.2 million, down from $168 million a year ago. Sales at Mindspeed Technologies, Conexant’s Internet infrastructure business, grew 15% over the prior quarter. Conexant is cutting 35% of Mindspeed’s 1,200 workers to get costs in line with its revenue. The cuts are expected to lower Mindspeed’s operating costs to less than $40 million a quarter from $60 million. Conexant said its Mindspeed revenue would grow sequentially by 10% in its September quarter.
Those results aren’t bad for two chipmakers that have watched spending on communications chips go downhill.
But it’s hard to be fully positive at home when chipmaking titans elsewhere are reducing expectations and, gulp, cutting spending on new chipmaking gear.
At July’s chip industry trade show Semicon West in San Jose, Intel Corp. said its capital spending for 2002 would be $5 billion to $5.2 billion, lower than the previous expectation of $5.5 billion.
STMicroelectronics Inc. lowered its capital spending in 2002. Taiwan Semiconductor Manufacturing Co. said it would cut its spending and warned of a slowdown in the current quarter.
Shares of Irvine-based Newport Corp., a chip equipment maker, have sunk 60% on the lower forecasts.
Even so, the fact that our local chipmakers seem to be on the cusp of some kind of a recovery should be cause for a little optimism.
STM Targets Latin America
Irvine-based STM Wireless Inc. recently opened the doors of a new sales office in Miami. The office will handle sales operations in Latin America, the company said.
STM builds wireless networks that send and receive voice and data using satellites, small land-based stations and other networking equipment. Customers can receive both Internet and phone service via STM’s networks. The company touts its system as a lower cost alternative to other telecommunications firms and targets emerging international telecommunications providers.
“STM has enjoyed strong sales in Latin America, and the establishment of an office in Miami will help us address the market more effectively,” said Emil Youssefzadeh, STM’s chief executive.
STM struck several pacts with European Internet service providers last year. The company also struck a deal to set up a satellite telephone network in Nepal.
Mind Matters to Donors
The Mind Institute, a non-profit organization started by University of California, Irvine physicist Gordon Shaw, recently received donations from several large foundations.
The institute,the name is an acronym for “Music Intelligence Neural Development Institute”,uses music to help kids develop subconscious skills needed to excel at math.
Four donors,Bank of America Foundation, California Community Foundation, Dwight Stuart Youth Foundation and the Samueli Foundation,recently donated a total of $475,000 to the institute.
“They are evidence of growing confidence in the institute’s innovative approach to math education as a valid and effective path to dramatic improvement in kids’ math skills and comprehension,” Shaw said.
The institute has already drawn donations from some of the county’s biggest benefactors, including Broadcom founder Henry Samueli, Emulex Corp. chief Paul Folino and FileNET Corp. founder Ted Smith. The three donated $1.5 million in the past year.
Hacker Software
Aliso Viejo-based High Tower Software Inc. released software for big financial institutions to instantly respond to hacker attacks.
“Today’s prevalence of online banking and other Internet practices expose banks and their customers to cyber crime,” said John Howard, marketing vice president for High Tower. The software is designed for companies with several layers of security, which High Tower says is ideal for the banking industry’s big networks.
Done Deal
It’s official. Irvine-based VitalStream Inc. has completed its acquisition of Salt Lake City-based Sensar Corp. VitalStream helps companies stream content over the Internet.
VitalStream will continue to be based out of Irvine. Sales and marketing efforts will be expanded to help attract more customers and increase brand awareness, VitalStream said.
