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November 2007

Spansion Takes Charge of the NOR Market

Executives at Spansion have been busy recently, opening a new fab and sealing deals that will help the company cement its lead in the NOR market. The new fab in Japan, SP1, is the world’s only 300mm dedicated NOR facility. The company has reduced its time to market from 42 months at 110nm to 31 months at 65nm, with a goal of shrinking to 21 months at 45nm. The company plans to ship volume production of 65nm MirrorBit devices by late this year, and 45nm by late 2008. While the company is still not turning a profit, it is in the best position of any leading NOR vendor to do so. The move to 300mm 65nm production will enable Spansion to enjoy a cost lead over its competitors.

An increasing percentage of Spansion’s sales come from its MirrorBit devices. This makes the acquisition of Saifun Semiconductor a natural move to better control the IP related to the company’s success. Saifun’s NROM IP is the basis for MirrorBit, and is also licensed to Macronix, NEC, SMIC, Sony, and Tower. The move will help Spansion with future design projects, but more importantly will eliminate the licensing and royalty payments it currently pays to Saifun. Spansion paid US$17.6 million in calendar year 2006 for licensing and design services to Saifun. This will help with Spansion’s cost reduction efforts, and provide a new source of revenue from the other licensees.

Intel and AMD report 3Q 2007 Results – Second Half Rebound for PCs

Last week Intel and AMD announced their 3Q 2007 financials. Both companies made strong gains driven by increase in PC sales, mainly notebooks.

Intel surpassed its projections for the quarter, hitting $10.1 B in total sales, up sequentially 16% and 15% yr-to-yr. Additionally its gross margin improved to 52.4% compared to 46.9% in 2Q 2007. The company reported record MPU unit shipments along with flat ASPs. The PC chipsets also hit record unit levels, while motherboard units were down.

Intel’s 4Q 2007 Outlook indicates continued strong recovery for the PC market. The company is projecting total sales between $10.5 and $11.1 B with gross margins around 57%. Intel has been shipping quad core MPUs (actually a pair of dual core die in one package) and will be ramping up production of its next generation 45nm MPU for desktop and servers.

AMD also reported a sequential 18% increase in total sales for 3Q 2007, $1.6B, and 23% yr-to-yr. The company’s Computing Solutions segment grew 17% sequentially. This was due to a 19% increase in MPU revenue, driven by MPU unit shipment growth of 16%. Within this the Mobile MPU unit shipments grew 41% sequentially and 68% yr-to yr. AMD introduced its native quad core Opteron (65nm) and continues to ramp up its 65nm –production.

Semico Spin

Intel Fab 32 Grand Opening – Ramping up 45nm MPUs

Last week Intel had its official grand opening for Fab 32 in Chandler, AZ. This is Intel’s sixth 300mm facility and its second at 45nm. The company’s Oregon development facility, D1D, has been producing 45nm MPUs. Fab 32 will be crucial for Intel’s aggressive ramp up schedule by providing high volume production. In early October Intel started production wafers. Two additional 45nm, 300mm manufacturing fabs are scheduled to open next year in Kiryat Gat, Israel (Fab 28) and Rio Rancho, N.M. (Fab 11x).

Fab 32 costs $3 B; it has 184,000 square feet of clean room space. The entire structure measures 1 million square feet. It is located on the same campus as Fab 12 and Fab 22. Currently Fab 12 is producing 65 nm MPUs. Eventually Intel will transition Fab 12 to 65nm Chipsets. Fab 22 is currently producing 130nm Southbridge chipsets. No word on the future plans for Fab 22.

Semico Spin

Intel’s strength is in manufacturing. The MPU design and process technology are important, but to maintain its market share and achieve economy of scale, Intel’s manufacturing capacity is a driving force.

MIPS Makes a Big Step Into 32-bit MCUs

On Oct. 30, 2007 MIPS made a major announcement that it will license its core for the 32-bit MCU market.

Up till now MIPS is available from various silicon providers as a standard MPU, ASIC, custom, or an ASSP. An MCU is designed for more of the traditional control applications and has embedded memory for the main program. This distinguishes it from an MPU. It is a general purpose device, which sets it apart from the other types of deices.

MIPS is offering several cores:

4K series (entry level)

34K, 24K (mid performance), mainly automotive.

74K (high performance

MIPS is also making available its EJTAG debug. Various functions are integrated around these basic MIPS cores. The company is leveraging its recent acquisition of Chipidea to provide Analog IP. The market focus for the 32-bit MCU will be automotive, industrial and what MIPS refers to as multipurpose: consumer, communications, and smart cards.

The licensees who will develop and sell MIPS based MCUs have yet to be announced.

Semico Spin

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