Despite its weak revenue growth guidance for this quarter, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) might see stronger growth from next quarter thanks to its next-generation packaging technology.
Analysts said the integrated fan-out (InFO) packaging could help TSMC beat rival Samsung Electronic Co in winning more A10 application processor orders from Apple, because the technology has the advantage of lower costs, higher speed and thinner form, compared with conventional flip chip packaging.
The InFO technology is at least 20 percent cheaper than existing packaging technology, Yuanta Securities Investment Consulting Co (元大投顧) analyst George Chang (張家麒) said in a report issued on Tuesday last week.
TSMC already has a complete InFO portfolio aimed at different package sizes and applications, he said in the report.
In a quarterly earnings conference call with investors on Thursday last week, TSMC co-chief executive officer C.C. Wei (魏哲家) said the company has almost completed equipment installation at a facility in Taoyuan’s Longtan District (龍潭) in preparation for InFO volume production.
“We expect to complete customer product qualification shortly and will be ready for volume production this quarter,” Wei said at the conference.
In addition to high-volume preparation and product qualification, “we are working on yield improvement and cost reduction,” Wei said.
TSMC, the world’s largest contract chipmaker, is sticking to its original estimate that InFO technology would contribute about US$100 million revenue in the final quarter of this year, Wei said.
“InFO will be a powerful technology to catch growth opportunity in both mobile and IoT [Internet of Things] markets,” he said.
Apple is widely speculated to unveil its new iPhone in the second half of this year, which analysts think is likely to drive TSMC’s business.
Daiwa Capital Markets Inc semiconductor analyst Rick Hsu (徐稦成) said that InFO is key to TSMC forging a closer relationship with Apple and adding momentum to future growth.
Hsu said TSMC demonstrated a solid track record of execution for A9 processors and its new InFO packaging is “another key to gaining traction with Apple.”
Researchers at Daiwa estimated that Apple’s order split for A9 processors was 45 to 55 percent for TSMC and Samsung, but this time the Taiwanese chipmaker could claim a lead in A10 processor orders against its South Korean rival, Hsu said in a report this week.
The increase in A10 orders is expected to help TSMC accelerate its revenue growth at “an above-seasonal” pace of 14 percent in the third quarter this year from the second quarter, Hsu said in a report on Thursday last week.
TSMC forecast revenue growth for the second quarter would only be between 6 to 7 percent from the previous quarter.
Following a significant volume ramp-up in the final quarter this year, the revenue contribution from InFO packaging could total US$300 million this year, Hsu said.
Industry watchers have said that TSMC’s interest in supporting the fan-out wafer-level packaging — which eliminates the need for the bumping process and it does not use the substrate in the flip chip process — shows that the company’s ambition to have a complete application processor, microcontroller units and graphics processing unit manufacturers, as well as semiconductor front-end process manufacturing and full back-end packaging services.
TSMC is the first chipmaker to commercialize the InFO technology for its 16 nanometer chips, providing both front-end and back-end services, Chang said, adding that it is becoming more difficult to solely rely on front-end tech node migration to drive better performance and cost.
Aside from Apple, other smartphone chip vendors are likely to follow suit in adopting InFO packaging along with TSMC’s 16 nanometer technology, if they are looking for a better solution for cost-sensitive, mid-end handsets, he said.
Shares of TSMC closed 1.24 percent lower at NT$159.5 on Friday in Taipei trading, after the company reported net profit fell 18 percent year-on-year in the first quarter.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the