Propelled by robust demand for artificial intelligence, high-performance computing and other emerging technology applications, the local integrated circuit (IC) sector’s production value should return to growth in the first quarter of this year after declining every quarter on an annual basis last year, the Ministry of Economic Affairs said yesterday.
Output slid 1.3 percent year-on-year to NT$943.8 billion (US$29.41 billion) in the final quarter of last year, albeit an improvement over the double-digit percentage declines in the previous three quarters, due to weak consumer electronics sales and supply-chain inventory adjustments, the ministry said in a report.
For the full year, production slumped 12.9 percent to NT$3.26 trillion last year, the second-highest on record after 2022’s NT$3.74 trillion, it said.
Photo: Sam Yeh, AFP
Due to a lower comparison base last year, the production value this year should show positive growth, it added.
Taiwan's IC sector boasts an advantage from an ecosystem within which different segments are supporting one another. Moreover, aided by continuous research and development, the sector’s production value grew for 11 consecutive years from 2012 to 2022, the ministry said.
The 12-inch wafer foundry segment leads the sector with its cutting-edge technology and global competitiveness, accounting for 68 percent of total IC output last year, the ministry said.
From 2012, the segment’s production value grew consistently, surpassing the NT$1 trillion mark in 2017 and hitting a record-high of NT$2.42 trillion in 2022, before retreating 8.4 percent to NT$2.22 trillion last year, it said.
The IC design segment ranked second, with output reaching NT$695.4 billion last year, or 21.3 percent of the total, it said.
As the IC design segment is positioned at the upper stream of the sector, it is sensitive to end-market demand and tends to be the first to signal changes in the semiconductor industry, the ministry said.
While other segments still posted declines, IC design’s output in the final quarter of last year reversed up 16.6 percent, it said.
The 8-inch and below wafer foundry segment ranked third in production value at NT$202.7 billion, accounting for 6.2 percent of the sector’s overall output, ahead of the DRAM segment’s NT$46.4 billion, or 1.4 percent of the total, the ministry said.
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