Chip equipment stocks aren't getting spared from a general market selloff after Samsung (SSNLF - the world's #2 chipmaker) guided for its 2014 chip capex to be flat Y/Y. AMAT -1.6%. LRCX -3.7%. ASML -0.7%. UTEK -2.2%. RTEC -3.2%. MTSN -5.1%.
Industry analyst Robert Marie observes this is the first time since 2009 that Samsung hasn't upped its chip capex budget. With Intel and TSMC (the industry's two other big clients) also guiding for capex to be flat (if not down) this year, Marie is cautious about 2014 growth, even though others have forecast sales will rebound sharply this year following a rough 2013.
KLA-Tencor (KLAC -2.2%) is joining the selloff even though the company posted an FQ2 EPS beat yesterday afternoon, and provided healthy FQ3 guidance - revenue of $790M-$850M and EPS of $1-$1.20 vs. a consensus of $814.5M and $1.11 - on its CC (transcript). KLA also forecast FQ3 bookings will be in a range of $700M-$800M (implies 10% Q/Q growth at the midpoint), and struck an upbeat tone about 2014 investments in 20nm and 3D NAND flash capacity.
KLA still expects 10%+ industry growth this year, but admits its outlook is "slightly weaker" than it was three months ago. The company also believes industry adoption of EUV lithography (important for ASML) has generally been pushed out to the 7nm process node from the 10nm node.