Gartner Inc yesterday said aggressive capacity expansion by major contract chipmakers, including Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), would cause severe oversupply in 2013 and drive down factory utilization to as low as 80 percent on average.
The market research firm shrugged off the short-term impact of the March 11 earthquake and tsunami in Japan, saying the disasters would only affect second-quarter demand.
Gartner kept its forecast of a 10.2 percent annual growth in the foundry sector for the whole year to US$31.15 billion unchanged, Gartner analyst Samuel Wang (王端) told a group of reporters in Taipei yesterday.
Instead, the primary concern facing the industry will be the large-scale expansion in 300mm capacity that will result from efforts launched by top contract chipmakers as they vie for a bigger market share this year and next year, resulting in a supply glut in 2013 when aggressive capital expansion translates into massive expansion of capacity, Wang said.
Overall, 300mm capacity is expected to increase by 34 percent year-on-year this year and by 28 percent next year, Wang said, adding that the fast--growing demand for smartphones and tablets would not be able to absorb such significant growth in capacity.
Contract chipmakers who are unable to supply chips made on advanced 40-nanometer and 28-nanometer technologies could suffer a decline in factory usage to as low as 70 percent by 2013 — lower than the average 80 percent, he said.
TSMC, the world’s biggest contract chipmaker commanding 47 percent market share last year, earlier said it planned to mass-produce chips on 28-nanometer technology — the most advanced technology currently available — next quarter.
Wang said TSMC’s rivals, such as GlobalFoundries Inc and Samsung Electronics, could lag behind the Taiwanese company for two quarters or even longer, if GlobalFoundries and Samsung started mass production of chips on 28-nanometer technology by the end of this year as scheduled.
TSMC plans to spend a -record-high US$7.8 billion on new equipment this year and has told investors more than once that it is not worried about overcapacity because its expansion plan is based on customer demand.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by