Even so, while sales have faltered, Chartered Semiconductor must keep investing in the latest chip-making equipment to keep pace with rivals, investors say.
"They're far too far behind," Whitley said. "It's just a case of prolonging its life."
Taiwan Semiconductor and United Microelectronics account for about 62 percent all custom-built chip sales, compared with 5 percent for Chartered Semiconductor, Gartner Inc says.
Chartered Semiconductor must also cope with competition from new companies starting production in China. They include Grace Semiconductor Manufacturing Corp (
In the past, chip companies have slowed expansion to allow demand to catch up with supply. These days, more factories are being built even though a rebound in demand hasn't occurred, said Ho Hsiu Mei, a money manager with Citigroup Asset Management in Singapore.
The result may be falling prices.
"Demand is not there and yet we are seeing new players come in," Ho said. "It doesn't look good."
Chartered Semiconductor's executive suites haven't been immune to chip-industry changes. Last month, Ang Kay Chai was named senior vice president, replacing John Docherty in the most recent of a string of new appointments. Since April, Chartered has changed its chief executive, chief financial officer and chairman and named two new senior vice presidents.
Chief Executive Chia Song Hwee says the company needs to use 70 percent of production capacity to break even, and 80 percent to generate US$1 billion in cash to cover spending on factories and equipment. Chartered Semiconductor expects to use just 40 percent of its chip-making equipment this quarter.
"We are working towards the business situation where we can be self-sufficient," Chia said on a conference call this week with analysts.
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