Tag: semiconductors

Samsung sales hit by smartphone business

Piccadilly Circus, pic Mike MageeKorean giant Samsung released its fourth quarter figures and shows it is being adversely affected by sales of smartphones.

As well as manufacturing smartphones, Samsung also makes chips inside the devices as well as displays, meaning it’s hit by a triple whammy.

The company said its results amounted to 53 trillion in the quarter – around about the same figure as this time last year.

It won’t release net profit figures until later in this month after the results have been independently audited.

Sales of smartphones are falling due to a largely mature market and Samsung in particular faces competition from a number of Chinese manufacturers digging into its market share.

TSMC benefits from Apple business

Picture courtesy of Wikimedia CommonsThe biggest semiconductor foundry in the world looks like it will report revenues of $30 billion next year.

TSMC, with its headquarters in Taiwan, has had a successful year and good write ups for the A9 processor it manufactured for Apple, according to market research company Trendforce.

It’s also likely to win most of the orders for Apple’s next processor, the A10.

According to Trendforce analysts, TSMC will increase its capital expenditure next year by around $10 billion, with most of that spend going into research and development for seven to 10 nanometre technology, and expanding its 12-inch wafer capacity.

TSMC announced earlier this week that it has plans to build a 12-inch wafer fab in Nanjing, in mainland China. That fab is intended to service the demand for integrated circuits in China.

Semiconductor sales expected to fall

Samsung DRAMLast week the semiconductor industry’s trade body predicted that sales would rise modestly in 2016.

But a market research company today said the opposite, and predicted that sales for 2016 will fall by 0.6 percent compared to this year, to stand at $329 billion. The culprit is the memory market.

2014 saw a 10.5 percent growth figure, according to Trendforce, which predicts that a continuing steep fall in the sales of memory products will “drag down” semiconductor sales revenues.

Memory is a big problem with sales of chips only growing by 1.8 percent in 2015. There’s a big problem with oversupply, and Trendforce believes both DRAM and NAND flash sales will fall.

Trendforce, like other market analysts believes that PC sales will stabilise because most of the stock piled up in warehouses and factories will have worked their way through the channel.

The automotive industry will buck the semiconductor trend with shipments and prices rising in 2016. Automotive applications will also help increase sales of analogue integrated circuits.

Trendforce thinks that Apple alone accounts for almost 10 percent of revenues for the foundry business.

Worldwide semi market shows tiny growth

Picture courtesy of Wikimedia CommonsThe World Semiconductor Trade Statistics group (WSTS) said that the semiconductor market will be worth $336 billion this year – with sales showing a small growth of 0.2 percent.

Breaking it down, the WSTS said growth in optoelectronics was 12.1 percent, sensors 3.4 percent and analogue 2.5 percent.

But there are declines in discrete chips of 6.8 percents, microprocessors of 1.5 percent, logic of 1.6 percent and memory of one percent.

The Americas, Europe and Japan show declines while there’s growth in the Asia Pacific region.

The WSTS only expects moderate growth in all product categories excluding all memory and all regions except Europe. It predicts that all major product categories and regions will grow – that is if there’s a rebound in the macro economy.

China to pour $47 billion into chip industry

Picture courtesy of Wikimedia CommonsTsinghua Unigroup, a conglomerate backed by the Chinese government, is to plunge $47 billion into the semiconductor business in the next five years.

That’s according to Reuters, which interviewed Tsinghua chairman Zhao Weiguo, who said China wants to become the third biggest semiconductor manufacturer in the world.

Intel, Samsung and Qualcomm hold the first three positions in semiconductor companies worldwide, but that could change because of the amount of money Tsinghua will throw into the chip pot.

Tsinghua has already said it has eyes on buying Mediatek and wanted to buy US memory manufacturer Micron. But moves like these are currently blocked by the Taiwanese and US governments respectively, which want to protect local manufacturers. Micron ruled out being bought  by Tsinghua.

But Tsinghua already has shares in US company Western Digital and Taiwan’s Powertech.

Tsinghua eyes up MediaTek

ChinaThe Chinese state backed consortium Tsinghua Unigroup wants to take over successful chip firm Mediatek.

China has a long range plan to grow its semiconductor industry and according to a report in Digitimes, Tsinghua’s chairman Zhao Weiguo said that if Taiwan lifts its ban on Chinese firm, there could well be a merger of the companies.

MediaTek said that it would be happy to talk with Tsinghua in a merger provided that Taiwanese government restrictions were lifted.

Although Taiwan does not allow Chinese companies to take shares in companies on the island, there’s a great deal of self interest in both countries cooperating.

For example, many Taiwanese semiconductor firms have factories in mainland China.

China threatens US, European fabs

ChinaThe Chinese government is committed to developing its own semiconductor business and it’s pretty clear that nothing is going to stop its advances.

Now market research company Trendforce has revealed the trends in the Chinese semiconductor market which is describes as a “growing challenge” to US and European IC manufacturers.

Trendforce said Powerchip started building a 12-inch fab in Hefei in China. The 12-inch factory is a joint venture between Taiwanese Powerchip and Hefei City Government and will start operation in 2017 and produce 40,000 wafers a month.

Trendforce pointed out that Chinese IC designers have had generous government subsidies and companies including HiSilicon and Spreadtrum are in the vanguard of the shannel.

While fabless IC firms onlyhave 18.5 percent market share worldwide, that figure is sure to rise in the next five years.

China’s own homegrown foundry company SMIC has three eight inch fabs in three locations and also two 12-inch wafer fabs in Shanghai and Beijing.

Both Taiwanese foundries TSMC and UMC also have fabs in mainland China.

PMC-Sierra in buying bid wars

Picture courtesy of Wikimedia CommonsThe chip market continues to show clear evidence of consolidation.

PMC-Sierra had a $2 billion bid for its business by Skyworks Solutions but that’s been trumped by semiconductor firm Microsemi, which has now offered to pay $2.2 billion for the firm.

PMC-Sierra sells chips into different sectors including embedded computing, storage and comms. It was founded in 1984.

Microsemi wants to expand its business into storage for data centres and cloud applications, and believes the acquisition of PMC-Sierra will help it do just that.

Microsemi appears to have succeeded in its bid for PMC-Sierra, with the bid expected to close by the end of this year.

According to Reuters, Morgan Stanley is putting up the money for the acquisition, which will result in Microsemi owning 85 percent of the company.

Chips face tough 2016

63-CH3SNAS_DRAMHot on the heels of news that TSMC has cut its plans to buy as much manufacturing equipment as it needed, a market research company based in Taiwan is predicting a tough time for optoelectronic and semiconductor companies in 2016.

Trendforce said weak demand was slowing down DRAM prices, coupled with a glut of memory chips. It estimates PC DRAM prices have fallen close to 40 percent this year and the server DRAM market will show steep declines during the second half of this year.

And while demand for NAND flash memory has been strong, but Trendforce is predicting that demand in 2016 will be conservative.

On the optoelectronic side, Trendforce thinks that the market for high brightness LED products will only grow by two percent in 2015, creating the right conditions for industry consolidation.

Average selling prices for this category of LED products has dropped by 30 to 40 percent during 2015, because of oversupply.

On the photovoltaic solar panel front, the outlook is better with demand to grow by nearly 10 percent in 2016. But there’s oversupply of PV too, which is expected to drive down prices considerably during the course of next year.

TSMC cuts chip equipment plans

TSMC fab in Hsinchu - Wikimedia CommonsThe Taiwan Semiconductor Manufacturing Co (TSMC) is the biggest chip foundry in the world but said today it will cut its spend on manufacturing equipment by more than a quarter.

TSMC had planned to spend $11 billion on equipment but has now cut that figure to $8 billion, with its net profit falling by 1.3 percent.

The company said in a financial statement that while revenues in its third quarter were essentially flat compared to the previous quarter, revenues were 4.3 percent down compared to the same quarter in 2015.

Net profit margins amounted to 35.4 percent for the quarter.

Twenty one percent of wafer revenues are now drawn from shipments of 16/20 nanometre silicon wafers, while 28 nanometre technology amounted to 26 percent of its total revenues.

Earlier this week, chip giant Intel warned that its data centre business for server chips wasn’t as buoyant as Wall Street had expected.