Taiwan Semiconductor Manufac-turing Co (TSMC,
"We expect inventory adjustments will continue for some time but the assessment just reaffirms the guidance given by the company in July on its earnings prospects for the third quarter [to September]," a company spokesman said.
Inventories in the electronics industry are watched closely as a key indicator of demand because the production chain is tightly integrated.
Large inventories can be counter-productive as holders usually try to clear their stock before ordering more goods.
The comments came after local media cited TSMC chief executive officer Rick Tsai (
The spokesman said TSMC has not presented any earnings guidance for the next quarter yet.
In July, the company said that due to on-going inventory adjustments it expected revenues in the current quarter to be flat or fall slightly compared with last quarter.
At the same time, TSMC revised down its forecast for semiconductor industry growth this year to 8 percent from the previous estimate of 8 percent to 12 percent.
Shares of TSMC closed up 1.03 percent to NT$59.00 on the Taiwan Stock Exchange yesterday.
Rival United Microelectronics Corp (
flash memory
UMC did not specify the purpose of its continued purchase of ProMOS shares, despite industry speculation that the world's second-largest chipmaker is eying the fast-growing NAND flash memory market.
NAND flash memory is becoming popular in digital cameras, mobile phones and Apple Computer Inc's iPods.
Separately, Taiwan will have at least eighteen 12-inch wafer fabrication plants by 2008, the Industrial Development Bureau (IDB) under the Ministry of Economic Affairs said yesterday.
The scale of Taiwan's wafer fabs will exceed that of the US, Japan and South Korea, and the gap between Taiwan and its closest rival -- South Korea -- will also be widened, IDB officials predicted.
Taiwan will become the most heavily populated place in the world in terms of 12-inch wafer plants as well as a stronghold for wafer producers, the officials forecast.
They noted that Taiwan currently has ten 12-inch wafer plants entering mass production. In addition, eight plants are under construction with another eight being planned.
The officials said that in view of the world trend toward "smaller and thinner" in the information and electronics sectors, 12-inch wafer plants, and upstream processes such as chip design and research and development will be crucial to the upgrading of Taiwan's semiconductor industry.
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