Numonyx aims to turn a profit by end of 2008

BRIAN HARRISON, CEO of new semiconductor company, Numonyx, kicked off the first leg of his first global tour of the company’s sites on Tuesday, starting at Israel’s Kiryat Gat Fab One.

Some 1,300 employees, some 20 per cent of Numonyx's global workforce, which spans several countries including Israel, Italy, Singapore, China and the US, are employed at Fab One, previously Intel’s Fab 18. Numonyx produces NOR flash at the 200-mm wafer fab, and NAND flash memory at a joint venture 300-mm wafer fab in Wuxi, China.

Numonyx was spawned into life through the fusion of Intel and ST Microelectronics’ flash memory units, with Intel still holding on to 45.1 per cent of the company while STM owns 48.6 per cent, and a private equity firm called Francisco Partners owns the remainder. Before becoming the new company’s CEO, Harrison had held the position of Intel VP and general manager of its Flash Memory Group.

Speaking at a press conference in Israel on Tuesday, Harrison noted that now that the technologies of both Intel and ST had been successfully combined, the new challenge ahead for the fledgling company would be to increase their profitability in the memory sector.

Fab One currently produces its NOR flash memory processors using 65-nanometre technology, which it inherited from Intel, but the fab is now preparing itself to produce processors with 45-nanometre technology by the second half of this year, more specifically, sometime in the fourth quarter of 2008. Harrison reckoned that this future production was “vital for the company's strategy", a view reinforced by Numonyx Israel’s general manager, Yonathan Wand.

Wand claimed that the move to 45nm was vitally important for two reasons, the first being financial; to considerably increase the number of chips on a wafer at only a negligibly higher cost. This, he said would increase cost effectiveness and bring in higher revenues for the company. The second reason the move to 45nm is such an integral part of Numonyx’s strategy, is because by doing so, they will be increasing the density of their memory products, an important step in consolidating market share.

Wand told the INQUIRER that his company would become profitable by at least the end of this year, by strengthening their position in the wireless and embedded markets and strictly controlling company spending. They would achieve this, he said, through the streamlining of Numonyx’s R&D into one main branch in Milan and a smaller one in Santa Clara, California.

Asked about whether he wasn’t concerned at the recent slump in NAND memory prices, Wand replied that he wasn’t, for several reasons. Numonyx, said Wand, sold NAND flash memory “only in niche markets”, mainly for “very specific applications”, and he added that they were “not Numonyx’s major revenue generator”. Wand also noted that the company was offering NAND memory as part of stacked packages, bundled with NOR flash.

According to Wand, the company’s main focus in the short term would be the consolidation and expansion of their embedded applications, a field in which Wand is highly optimistic that the company will succeed. µ