15.4% in one year due to reduced orders from Apple etc.
Possible loss of Samsung Electronics – UMC also sluggish
“During the recession, memory business conditions contracted”
The foundry (semiconductor consignment production) market is rapidly freezing due to the prolonged global economic recession. It is interpreted that the foundry industry has also been affected by the ‘semiconductor cold wave’ following memory semiconductors, with sales of Taiwan’s TSMC, the world’s No. 1 foundry company, falling for the first time in about four years last month.
According to the industry on the 17th, the March sales announced by TSMC on the 10th of this month was NT$145.48 billion, down 15.4% compared to the same period last year. It is the first time since May 2019 that monthly sales have decreased compared to the same period last year.
TSMC’s sales last month were the lowest in 17 months since October 2021 (TWD 134.539 billion). TSMC’s monthly sales growth compared to the same period of the previous year continued, such as October of last year (56.3%), November of last year (50.2%), December of last year (23.9%), January (16.2%) of this year, and February (11.1%) of this year. showed a decline.
TSMC’s sales declined because the economic recession continued and customer demand shrank. Yang Seung-soo, an analyst at Meritz Securities, analyzed that “the decline in orders from major customers such as Apple, AMD, and Nvidia is gradually being reflected due to the slowdown in consumption.”
Taiwan’s UMC, the world’s third-largest foundry company after TSMC and Samsung Electronics, recorded sales of NTD 54.21 billion in the first quarter (January to March) of this year, down 14.3% from the same period last year. Based on sales in March, it decreased by 20.1% compared to the same period last year. Samsung Electronics is also likely to post a loss in the foundry division in the first quarter due to a decrease in order volume.
Unlike memory, which supplies pre-manufactured products to the market, foundry has been relatively less affected by the economy because it is a method of consignment production of customer orders. Unlike general-purpose semiconductors, it is because the inventory burden is small by applying an on-demand production method. This is why the foundry was relatively good even when the semiconductor industry contracted due to a sharp drop in memory prices last year.
However, it is interpreted that the recession has been prolonged, customers’ inventories have accumulated and orders have decreased, and even the foundry industry has collapsed. An official from the domestic semiconductor industry said, “The foundry has been less affected by the economic downturn than the memory industry because of its high order volume and low production capacity compared to market demand.” It even reached this foundry,” he said.
Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.