Fri, Sep 01, 2017 - Page 11 News List

MIC downgrades outlook for chips

MIXED PICTURE:While the sector as a whole could be dragged down by chip designers, growth is forecast for foundries and testing and packaging companies

By Lisa Wang  /  Staff reporter

The local semiconductor sector could this year see revenue grow at a slower-than-expected 1 percent to NT$2.35 trillion (US$77.8 billion), as handset chip designers face intensifying competition from China, the Market Intelligence and Consulting Institute (MIC, 產業情報研究所) said on Wednesday.

The forecast represented a downward revision compared with the institute’s June estimate of 3.5 percent growth.

Taiwan’s semiconductor companies could be eclipsed by their global peers, whose annual revenue is projected to grow 9.8 percent annually, the MIC said.

Growth in the segment is fueled by rising demand for memory and logic chips used in cars and industrial devices, the institute said.

The institute attributed the tepid growth to weak growth momentum from local handset chip designers, led by MediaTek Inc (聯發科).

Taiwanese chip designers are to see revenue shrink 5.8 percent this year, MIC information system and application deputy director Charles Chou (周士雄) said.

That forecast is much deeper than the 2 percent contraction the institute forecast in June.

The foundry sector, led by Taiwan Semiconductor Manufacturing Co (台積電), is forecast to grow 3.2 percent to NT$1.19 trillion this year, benefiting from its leading technological position, Chou said.

Without the New Taiwan dollar’s appreciation versus the US dollar, the foundry sector would grow at a faster 9.2 percent rate this year from last year, he said.

Chip testing and packaging service providers are forecast to see revenue grow 5.9 percent this year in NT dollar terms, driven by strong demand for memory chips and chips used in consumer electronics and cars.

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