NVLS Reiterates Q4 View; An AAPL Vs. NOK World

Chip equipment maker Novellus Systems (NVLS) this afternoon offered a mid-quarter update to Q4′s outlook, the quarter ending this month, reiterating its expectation for revenue in a range of $260 million to $290 million, as forecast when it reported Q3′s results on October 26th.

The company also still sees EPS in a range of 42 cents to 62 cents on a GAAP basis.

Analysts have been modeling $276.6 million in revenue and 46 cents a share.

The company also said its expected quarter-to-quarter increase in bookings will be at the high end of the previously set range of up 10% to 30%, now expected to be up 20% to up 30% from Q3′s level.

Reports I’ve seen had expected tonight’s reiteration, and even the update to the high end of bookings, so there’s little to surprise in tonight’s release.

Novellus shares are down 13 cents at $35.47 in late trading.

Update: On the conference call this afternoon with analysts, Novellus CEO Rick Hill said that the semiconductor equipment business is improving since that October report.

“Macroeconomic factors are still volatile, but the recent market performance is helping to build confidence in the US economy, which is a precursor to growth,” he observed.

While Novellus is finding customers in the DRAM business are still “weak,” smartphones and tablets are fueling demand for equipment among NAND flash memory producers and among the foundries, the contract manufacturers of chips.

Hill noted that he had just received his Samsung Electronics (SSNLF) “Galaxy S II” smartphone, citing it as an example of products leading the chip industry. “It’s just an amazing product.”

He noted that some chip customers were dragging down foundries while others were lifting it, contrasting Nokia (NOK) and Apple (AAPL):

Now, relative to foundries in particular, you and I have talked that the foundry model is the right model. That model isn’t going away. The phenomenon you’re seeing now is foundries are lined up with customers and as more of semiconductors become consumer-oriented, if you win big, you go big and if you lose big, you lose big. And so some foundries — Nokia has sort of really been hit hard and so that whole food chain gets hit hard. While on the other hand, as we all know, Apple has done extremely well and so the foundry chain that supports Apple does well. I don’t think that phenomenon is going to change.

Hill said NAND flash chips will have “a good year” next year. He said the recovery among foundry customers is not limited to single customer, but is also “not broad-based yet.”