ASE Technology Holding Co (日月光投控), the world’s largest chip packaging and testing service provider, yesterday said it is expanding capacity at a factory in Penang, Malaysia, as the company is bullish about longer-term semiconductor demand driven by artificial intelligence (AI) and people-to-machine and machine-to-people applications.
The company expects the first building of the Malaysian factory to start operations in July next year, with construction of a second building to begin in 2025, ASE chief operating officer Tien Wu (吳田玉) told reporters on the sideline of a news conference for the Semicon Taiwan trade show in Taipei.
The Penang factory is expected to generate US$750 million in revenue in two to three years, doubling from its current US$350 million, the company said.
Photo: Grace Hung, Taipei Times
Wu said that ASE is also expanding capacity in California through its US subsidiary, ISE Labs Inc, in response to customer requests.
ISE Labs plans to acquire a building in San Jose for US$24 million, ASE said last week.
In Taiwan, ASE is boosting capacity at factories in Kaohsiung, Taoyuan and Taichung, Wu said.
Although the industry is undergoing an inventory correction, the demand outlook remains strong in the long term, with global semiconductor revenue likely to reach US$1 trillion in 2030, fueled by demand for chips to power AI, robots, electric vehicles, advanced driver-assistance systems and Internet of Things devices, he said.
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that the second half of this year would be tough as most customers are still digesting inventories.
However, most customers are reporting a rebound in revenue this quarter, GlobalWafers chairwoman Doris Hsu (徐秀蘭) said, adding that customers are steadily leveling off inventories.
“We have high hopes for a recovery in the first half of next year. From the second quarter next year, we expect to see a more significant pickup,” Hsu said.
However, semiconductor companies are facing pressure to diversify production locations to address geopolitical tensions and a push to reduce carbon emissions, she said.
To boost supply chain resilience, GlobalWafers and some Taiwanese companies have been asked to build capacity beyond Taiwan, which fragments capacity and raises manufacturing costs, Hsu said.
GlobalWafers faces milder pressure compared with its peers as it has diversified to 10 countries through mergers and acquisitions over the past 20 years, Hsu said.
The company also plans to spend NT$100 billion to expand capacity at its fabs for three years beginning this year, and is building a new fab in Texas, she added.
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