10.18.2001
Expectations on Flip-Chip II coming up short

• Compeq has announced declining revenue in 4Q01, caused by the phasing out of Flip-Chip I (P3), low margin handset orders, and slow Flip-Chip II certification from Intel. Contribution from the telecom & networking segment in 4Q01 is unsubstantial, even looking into 1Q02. Previously, firm’s Flip-Chip II substrate (for Intel P4 CPU & 845 Chipset) showed promise. However, we believe Compeq may need a 1-3 month learning curve for mass production, likely too late to catch competitor Nan-Ya Co. (unlisted), which has established Flip-Chip II delivery to Intel.