Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world's largest custom-chip maker, said it may raise prices to counter higher costs.
“Semiconductor companies are under profitability pressure,” Jason Chen (陳俊聖), vice president of worldwide sales marketing, said yesterday at the company’s technology symposium in Hsinchu, where TSMC is based.
Higher oil prices and Taiwan’s appreciating currency are crimping the company’s earnings, Chen said. The chip industry’s trend of falling average selling prices and rising research and development costs is unsustainable, he said.
“We must change it,” Chen said. He didn’t say how much prices would be raised or when it would happen.
The nation’s consumer prices rose 3.86 percent last month year-on-year, the Directorate General of Budget, Accounting and Statistics (DGBAS) reported on May 5. The core CPI, which excludes prices of products such as vegetables, fruit, fishery products and energy, rose 3.1 percent year-on-year last month, the highest level since March 1999, the DGBAS said.
Separately, global semiconductor sales this year will probably increase less than previously forecast, on slumping demand for memory chips used in personal computers and consumer electronics, the industry’s largest association said.
Chip sales will probably rise 4.7 percent to US$267.7 billion this year, less than the 9.1 percent forecast in November, and will gain 5.8 percent next year, WSTS Inc said yesterday in a statement. Revenue increased 3.2 percent last year, the San Jose, California-based group said.
WSTS, whose members account for about 90 percent of the industry, joins market researcher ISuppli Corp and UBS AG in lowering the outlook amid concern the global economy is slowing. The worst housing slump in more than a generation in the US is undermining home values, consumer spending and overall growth.
Revenue in the industry will rise 4 percent to US$273 billion this year, less than the 7 percent forecast earlier, UBS said last month, citing “weak” prices for memory chips and slowing consumer spending. El Segundo, California-based ISuppli last month cut its projection to 4 percent this year from 7.5 percent.
ADDITIONAL REPORTING BY STAFF WRITER
Quanta Computer Inc (廣達) chairman Barry Lam (林百里) is expected to share his views about the artificial intelligence (AI) industry’s prospects during his speech at the company’s 37th anniversary ceremony, as AI servers have become a new growth engine for the equipment manufacturing service provider. Lam’s speech is much anticipated, as Quanta has risen as one of the world’s major AI server suppliers. The company reported a 30 percent year-on-year growth in consolidated revenue to NT$1.41 trillion (US$43.35 billion) last year, thanks to fast-growing demand for servers, especially those with AI capabilities. The company told investors in November last year that
Taiwanese suppliers to Taiwan Semiconductor Manufacturing Co. (TSMC, 台積電) are expected to follow the contract chipmaker’s step to invest in the US, but their relocation may be seven to eight years away, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. When asked by opposition Chinese Nationalist Party (KMT) Legislator Niu Hsu-ting (牛煦庭) in the legislature about growing concerns that TSMC’s huge investments in the US will prompt its suppliers to follow suit, Kuo said based on the chipmaker’s current limited production volume, it is unlikely to lead its supply chain to go there for now. “Unless TSMC completes its planned six
Intel Corp has named Tasha Chuang (莊蓓瑜) to lead Intel Taiwan in a bid to reinforce relations between the company and its Taiwanese partners. The appointment of Chuang as general manager for Intel Taiwan takes effect on Thursday, the firm said in a statement yesterday. Chuang is to lead her team in Taiwan to pursue product development and sales growth in an effort to reinforce the company’s ties with its partners and clients, Intel said. Chuang was previously in charge of managing Intel’s ties with leading Taiwanese PC brand Asustek Computer Inc (華碩), which included helping Asustek strengthen its global businesses, the company
Power supply and electronic components maker Delta Electronics Inc (台達電) yesterday said second-quarter revenue is expected to surpass the first quarter, which rose 30 percent year-on-year to NT$118.92 billion (US$3.71 billion). Revenue this quarter is likely to grow, as US clients have front-loaded orders ahead of US President Donald Trump’s planned tariffs on Taiwanese goods, Delta chairman Ping Cheng (鄭平) said at an earnings conference in Taipei, referring to the 90-day pause in tariff implementation Trump announced on April 9. While situations in the third and fourth quarters remain unclear, “We will not halt our long-term deployments and do not plan to