An overwhelming majority of semiconductor executives expect revenue to grow this year, driven mainly by automotive applications that are putting wireless communications to the backseat, a survey released yesterday by global consultancy firm KPMG showed.
Eighty-one percent of respondents said that their company’s revenue would increase over the next year, and half of them said they expect growth of more than 10 percent, the survey of 151 global semiconductor executives last quarter showed.
Although lower than last year’s 95 percent and 68 percent respectively, the findings are encouraging in light of recent economic uncertainty, inflation, monetary tightening and geopolitical tensions, a KPMG report said.
Photo: Ritchie B. Tongo, EPA-EFE
Taiwan supplies 60 percent of the world’s chips used in smartphones, notebook computers, wearable devices, vehicles, and big data and Internet of Things applications.
KPMG’s Semiconductor Industry Confidence Index score is 56 for the upcoming 12 months, the report said, adding that a value above 50 suggests a more positive than negative outlook.
Sixty-four percent of executives forecast that the industry’s revenue will pick up this year, significantly lower than last year’s 97 percent, it said, citing the war in Ukraine as a contributor to the weaker growth projection.
About 40 percent said they were concerned the war would materially affect industry revenue prospects, higher than 25 percent a year earlier, it said.
For the first time, respondents rated the automotive industry as the most important segment driving company revenue over the next year, it said.
Automotive semiconductor revenue is expected to reach US$200 billion a year by the mid-2030s and surpass US$250 billion by 2040, KPMG had said earlier.
Wireless communications, long seen as the industry’s biggest revenue driver, slipped into second place from the previous year, it said.
Internet of Things, cloud computing and artificial intelligence ranked third, fourth and fifth in terms of importance respectively, the survey showed.
The “metaverse” as a segment, which appeared in the survey for the first time, ranked last out of 10 in importance for driving semiconductor revenue over the next year, it said.
The report said that executives might change their view in the coming years as metaverse technology evolves and adoption increases.
Sixty-five percent of respondents said they think a semiconductor supply shortage would ease this year, while 15 percent said they believe that supply and demand is already in balance for most products, and 20 percent said they think the shortage would continue into next year or later.
Regarding when executives expected the next semiconductor inventory glut to occur, 24 percent said they believe there is already excess inventory.
Securing talent is seen as the biggest issue facing the industry over the next three years, with 71 percent saying they would seek to increase their global workforce this year, it said.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
PRESSURE EXPECTED: The appreciation of the NT dollar reflected expectations that Washington would press Taiwan to boost its currency against the US dollar, dealers said Taiwan’s export-oriented semiconductor and auto part manufacturers are expecting their margins to be affected by large foreign exchange losses as the New Taiwan dollar continued to appreciate sharply against the US dollar yesterday. Among major semiconductor manufacturers, ASE Technology Holding Co (日月光), the world’s largest integrated circuit (IC) packaging and testing services provider, said that whenever the NT dollar rises NT$1 against the greenback, its gross margin is cut by about 1.5 percent. The NT dollar traded as strong as NT$29.59 per US dollar before trimming gains to close NT$0.919, or 2.96 percent, higher at NT$30.145 yesterday in Taipei trading
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