Mobile chips used in Apple Inc products may account for 20 percent of the sales of Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) in the next two years, according to a Barclays PLC research note.
That would be a significant increase from the less than 5 percent share of the world’s largest chipmaker’s sales contributed by Apple in the first quarter of this year, the British bank said in the research note on Friday last week.
Barclays Asia-Pacific semiconductor analyst Andrew Lu (陸行之) said the new chips TSMC makes for Apple could include A8 and A9 application processors, as well as integrated circuits designed for fingerprint sensors and the rumored “iWatch” wearable device.
TSMC could also benefit from a technology shift to the advanced 64-bit ARM-based chips for smartphones and micro servers, which could contribute “incremental growth” to TSMC’s sales in the next few years, he said.
In the first three months of the year, TSMC reported higher-than-expected consolidated sales of NT$148.22 billion (US$4.91 billion) on rising demand for chips that employ the advanced 28-nanometer (nm) process.
Analysts said TSMC’s latest sales data showed that the company has not been affected much by the traditional slowness seen in the IC industry in the first quarter.
“Higher sales and NT dollar depreciation should lift [TSMC] gross margins at least in-line with the 47 percent guidance,” Credit Suisse analyst Randy Abrams said in a report yesterday.
Credit Suisse said TSMC’s sales would increase 15 percent this quarter from last quarter, and forecast the company’s sales for the second half of the year could improve further as its ramps up shipments for Apple’s new products and when China migrates into the long-term evolution telecom network.
TSMC shares closed up 0.42 percent at NT$120.5 yesterday on the Taiwan Stock Exchange.
Barclays gave TSMC shares an “overweight” rating and revised its target price to NT$160 from NT$139. The brokerage also raised its estimates for TSMC’s earnings per share for this year by 7 percent to NT$8.92 and by 4 percent to NT$9.54 for next year.
Credit Suisse maintained its “outperform” rating with the NT$130 target price.
“We stay positive with TSMC’s business holding better in 2014 on 28nm and 20nm strong share sustaining and into 2015 where 16nm FinFET tape-outs are also building and dividend may start rising,” Abrams said in the report.
TSMC is scheduled to release its first quarter earnings results and give its second quarter sales guidance at an investor conference on Thursday.
Additional reporting by Kevin Chen
With this year’s Semicon Taiwan trade show set to kick off on Wednesday, market attention has turned to the mass production of advanced packaging technologies and capacity expansion in Taiwan and the US. With traditional scaling reaching physical limits, heterogeneous integration and packaging technologies have emerged as key solutions. Surging demand for artificial intelligence (AI), high-performance computing (HPC) and high-bandwidth memory (HBM) chips has put technologies such as chip-on-wafer-on-substrate (CoWoS), integrated fan-out (InFO), system on integrated chips (SoIC), 3D IC and fan-out panel-level packaging (FOPLP) at the center of semiconductor innovation, making them a major focus at this year’s trade show, according
DEBUT: The trade show is to feature 17 national pavilions, a new high for the event, including from Canada, Costa Rica, Lithuania, Sweden and Vietnam for the first time The Semicon Taiwan trade show, which opens on Wednesday, is expected to see a new high in the number of exhibitors and visitors from around the world, said its organizer, SEMI, which has described the annual event as the “Olympics of the semiconductor industry.” SEMI, which represents companies in the electronics manufacturing and design supply chain, and touts the annual exhibition as the most influential semiconductor trade show in the world, said more than 1,200 enterprises from 56 countries are to showcase their innovations across more than 4,100 booths, and that the event could attract 100,000 visitors. This year’s event features 17
SEMICONDUCTOR SERVICES: A company executive said that Taiwanese firms must think about how to participate in global supply chains and lift their competitiveness Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said it expects to launch its first multifunctional service center in Pingtung County in the middle of 2027, in a bid to foster a resilient high-tech facility construction ecosystem. TSMC broached the idea of creating a center two or three years ago when it started building new manufacturing capacity in the US and Japan, the company said. The center, dubbed an “ecosystem park,” would assist local manufacturing facility construction partners to upgrade their capabilities and secure more deals from other global chipmakers such as Intel Corp, Micron Technology Inc and Infineon Technologies AG, TSMC said. It
EXPORT GROWTH: The AI boom has shortened chip cycles to just one year, putting pressure on chipmakers to accelerate development and expand packaging capacity Developing a localized supply chain for advanced packaging equipment is critical for keeping pace with customers’ increasingly shrinking time-to-market cycles for new artificial intelligence (AI) chips, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) said yesterday. Spurred on by the AI revolution, customers are accelerating product upgrades to nearly every year, compared with the two to three-year development cadence in the past, TSMC vice president of advanced packaging technology and service Jun He (何軍) said at a 3D IC Global Summit organized by SEMI in Taipei. These shortened cycles put heavy pressure on chipmakers, as the entire process — from chip design to mass
RSS