GlobalWafers Co (環球晶圓), the world’s third-largest silicon wafer supplier, yesterday said that the financial turmoil in the US and Europe has dimmed the outlook for chip demand in the second half of this year, as growing economic uncertainty could dampen consumer spending.
The Hsinchu-based wafer manufacturer said it is seeing greater pressure from economic uncertainty on the industry’s recovery, as customers would have not expected Silicon Valley Bank, Signature Bank and a tier-one bank like Credit Suisse Group SA to collapse suddenly.
Although the failures are unlikely to cause systemic risks, consumers would be cautious of spending on non-essential items, such as electronics, GlobalWafers said.
Photo: Grace Hung, Taipei Times
“We previously expected that the third quarter would be a better period. However, some customers have turned more conservative due to the spate of financial turmoil. Before that, they were more proactive” about placing orders,” GlobalWafers chairwoman Doris Hsu (徐秀蘭) said on the sidelines of an investors’ conference in Taipei.
Two months ago, GlobalWafers told investors that chip demand would pick up at a marked pace during the second half, as customers’ inventory corrections were expected to bottom out at the end of the second quarter, paving the way for a rebound in end-product demand from the third and fourth quarters.
“We are not saying that market demand will sour in the second half,” Hsu said. “Overall market sentiment turned conservative. At the same time, we also see signs of a positive direction.”
The company signed two new long-term supply agreements in the first quarter, normally a low season, Hsu said.
That indicates some customers remain bullish about chip demand in the long run, she said.
Infineon Technology AG, one of its long-term customers, this week issued a robust business outlook for this year, Hsu said.
Infineon did not ask for a delay in wafer shipments like other customers, given solid demand for power chips, she said.
Texas Instruments Inc also said it might rebuild inventory, as its stocks have dropped to a low level, Hsu said.
Another encouraging sign is that some customers have asked to reduce the number of wafers whose shipments had been delayed, Hsu said.
In addition to strong demand for chips used in autos and industrial devices, GlobalWafers has seen a recovery in demand from display drive IC makers, while demand from memorychip makers remains fragile, she said.
The company’s 8-inch and 12-inch wafer plants continue to operate at a higher utilization rate of at least 95 percent, the company said.
Regarding GlobalWafers’ new 12-inch fab in Texas, Hsu said construction has been proceeding as planned.
The US plant is expected to ramp up production at the beginning of 2025.
Asked if GlobalWafers believes the US’ request to share profits of subsidy applicants based on the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act is “excessive,” Hsu said the company is categorized as a material company, rather than a foundry company, so the requirements could vary.
The company is closely monitoring when the US would release details about subsidy applications for “Phase 2” companies, she said.
REASSURANCE: The company, which installed new equipment in its Taichung plant, said that it would produce 1-gamma nanometers node DRAMs in Taiwan in 2025 US-based memorychip supplier Micron Technology Inc on Friday said that it would start producing its most advanced DRAM exclusively in Taiwan in 2025. Micron said that it would mass produce chips using its advanced 1-gamma process node DRAM in Taiwan, ahead of any other production site worldwide. The company installed cutting-edge extreme ultraviolet (EUV) lithography production equipment in its A3 fab in Taichung last year. The 1-gamma process — its third-generation 10 nanometer-class node — was jointly developed by Micron’s research and development (R&D) teams in Taiwan and Japan. Micron on Thursday said it would invest up to US$3.6 billion in Japan. A Ministry
MARKET GAP: If China stops buying chips from US firm Micron, they might turn to competitors such as Nanya and South Korean suppliers, researchers said Nanya Technology Corp (南亞科技) shares rallied nearly 4 percent during early trading yesterday amid optimism that the nation’s biggest DRAM chipmaker would benefit from China’s latest ban on purchasing memory chips from Micron Technology Inc. The restrictions are widely considered a result of an escalating technology dispute between the US and China. Chinese firms might shift orders to non-US suppliers such as Nanya Technology and South Korean memory chipmakers Samsung Electronics Co and SK Hynix Inc. The Cyberspace Administration of China on Sunday night said that its review found that Micron’s memory chips pose serious network security risks to the country’s critical
SECURITY RISK: Chinese companies could respond to the announcement by moving away from all products made by the US firm, diverting business toward Korean rivals China delivered the latest salvo in an escalating semiconductor war with the US, announcing that Micron Technology Inc products have failed to pass a cybersecurity review in the country. Operators of key infrastructure in China should not buy the company’s goods, the Cyberspace Administration of China (CAC) said in a statement on Sunday, adding that it found “relatively serious” cybersecurity risks in Micron products sold in China. The components caused “significant security risks to our critical information infrastructure supply chain,” which would affect national security, it said. The results come more than a month after China announced an investigation on imports from
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) senior vice president of business development Kevin Zhang (張曉強) told reporters yesterday that talks over a possible plant in Germany are continuing and that the earliest decision would be in August. “I don’t want to get into the politics side of the thing, but I do think that there is a need for us to provide our customers with a diverse supply,” Zhang said, adding that Europe is a “very significant geography given the customer base ... [and] the demand.” Zhang did not confirm the size of subsidy or cost of the potential project or