Tue, May 20, 2008 - Page 12 News List

Semiconductor firms’ revenue expected to ease

CHIPS ARE DOWNThe Industrial Technology Research Institute said local companies may lag behind their global counterparts, thanks to slumping prices and a supply glut

By Lisa Wang  /  STAFF REPORTER

Local semiconductor companies led by Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) are expected to report a weaker-than-forecast 4.4 percent revenue growth this year, with fastest growth for chip packers coming from the trend of outsourcing chip packaging services, the Industrial Technology Research Institute (ITRI, 工研院) said yesterday.

That means that local companies may slightly lag behind the global semiconductor industry, which is expected to expand 4 percent to 6 percent year-on-year this year, the government-funded institute said.

Local firms have largely outpaced their global peers over the past decade, ITRI said.

Local companies may generate 4.4 percent more revenues to NT$1.53 trillion (US$49.9 billion) this year from last year, slower than 5.3 percent annual growth last year, ITRI said.

It did not provide last year’s figure.

“A slump in the computer memory, or dynamic random access memory [DRAM], industry is the major reason for the weaker growth,” ITRI analyst Jerry Peng (彭茂榮) said in a telephone call.

The nation’s three largest DRAM suppliers — led by Powerchip Semiconductor Corp (力晶半導體) — posted losses of NT$26.57 billion for the first quarter because of a supply glut.

Local chipmakers, which make up about half of the revenues of local semiconductor firms, are expected to report lower revenues, or down 0.5 percent to NT$732.8 billion this year from last year, ITRI said.

Recent cooperation between the nation’s second-largest contract chipmaker United Microelectronics Co (UMC, 聯電) and Japan’s Elpida Memory Inc would help UMC tap the Japanese market and attract new Japanese customers for UMC’s chip design subsidiary, Paraday Technology Corp (智原科技), the researcher said.

Compared with a lackluster outlook for chip manufacturers, Taiwanese chip packaging service providers — including the top player Advanced Semiconductor Engineering Inc (ASE, 日月光) — may outpace other chip companies by reporting 10.7 percent growth to NT$252.5 billion this year from last year, ITRI said.

“Taiwanese chip packagers show promising growth, benefiting their buildup in China and growing orders from integrated design manufacturers [IDM] and their completing Chinese operation,” ITRI said in a statement.

Local chip testers are expected to increase their revenues by 9.3 percent to NT$111.8 billion this year from last year.

In the first quarter, local semiconductor companies’ revenues inched up 0.4 percent to NT$342.8 billion from a year earlier after DRAM prices collapsed on glut and sluggish demand in the slow season, ITRI said.

This story has been viewed 2528 times.
TOP top