Foundries to Enjoy Some Good Years, IHS Predicts
IHS iSuppli said pure-play foundries are likely to see “brisk” growth in 2012, led by demand from tablets, smartphones, and Ultrabook PCs.
While the overall chip industry is set to grow about 4 percent this year, IHS iSuppli foresees that revenue in 2012 for pure-play foundry suppliers will grow to $29.6 billion, up 12 percent from $26.5 billion in 2011. The rapid growth this year follows what the market research companies called a “tepid” 3 percent expansion in 2011 after a “blistering” 45 percent surge in 2010 following the recession.
“Foundry suppliers started to see a steady increase in demand starting late in the first quarter, with revenue expected to peak in the traditionally strong third quarter,” the report noted.
Unlike last year’s sudden slowdown, however, foundry revenue will remain strong in the years ahead. Revenue will rise another 14 percent next year to an estimated $33.6 billion, with solid double-digit growth continuing in 2014 and 2015. By 2015 the foundry market should approach $42.2 billion in revenues.
Len Jelinek, director and chief analyst of semiconductor manufacturing at IHS, said, “This year’s notable performance is a result of the widespread growth of consumer-related products requiring advanced technology for low-power applications. For such applications, the overall number of semiconductors—or semiconductor content—must grow in order to support the more sophisticated functionalities.”
NAND flash and ASICs will do particularly well in these consumer products, while a “revitalized” notebook market—due to the Ultrabook’s emergence—will power revenue growth in the microprocessor semiconductor space, the market research firm said.
The most critical issue in 2012 will continue to be the global economy, while inventories also remains a key concern throughout the supply chain. Companies are waiting to place orders at the last possible minute, knowing that overall manufacturing capacity remains in excess of demand, Jelinek said.
The pure-play foundry landscape continues to be “fragmented into a principal echelon comprising the Top 4 suppliers, with the remaining 16 companies forming a less influential second tier,” the report said.
The Top 4 pure-play foundries last year included No. 1 Taiwan Semiconductor Manufacturing Corp. (TSMC) with revenue of $14 billion, followed by UMC at $3.6 billion, GlobalFoundries with $3.5 billion in revenues, and fourth-placed Semiconductor Manufacturing International Corp. (SMIC) with $1.3 billion.
At No. 5 last year and ranked at the top of the second tier was TowerJazz Semiconductor with $613 million.
(Source: IHS iSuppli Research)
Tags: GlobalFoundries, IHS iSuppli, TSMC