Semiconductor Industry

[winston]

Taiwan's UMC posts 47 pct drop in March sales

TAIPEI, April 8 (Reuters) - UMC <2303.TW>, the world's No.2 contract chip maker, posted a 47 percent annual fall in March sales amid weak tech demand, but the decline was slower than the previous two months, suggesting the first quarter marked a bottom.

Sales at United Microelectronics Corp (UMC) reached T$4.541 billion ($134 million) last month, down from T$8.498 billion a year ago, but improved from February's T$3.14 billion, the Taiwan company said on its web site on Wednesday.

UMC released the results after the Taipei stock market closed on Wednesday. UMC shares fell 4.5 percent, sharper than a 2.4 percent fall on the main TAIEX share index <.TWII>.

[winston]

TSMC Q1 sales beat f'cast, upside seen in Q2

Reuters - Friday, April 10

* Q1 sales fall but beat company and analysts' estimates
* Analysts bullish on Q2 sales

By Baker Li

TAIPEI, April 10 - Top contract chip maker TSMC's <2330.TW> first-quarter sales fell 55 percent, hit by weak chip demand, but the result came above forecasts, driven by recent rush orders related to China's stimulus package.

Analysts say TSMC and its crosstown rival, UMC <2303.TW>, are among major beneficiaries of China's recent move to boost spending on PCs, mobile phones and televisions that require chips in rural areas, a trend that could last into the next few months.

Taiwan Semiconductor Manufacturing Co Ltd <TSM.N> reported unconsolidated sales of T$13.6 billion in March, down 49 percent from a year ago, but the drop eased from the previous three months.

The fall was similar to UMC's <UMC.N> 47 percent fall in March sales. [ID:nTP268331]

"There has been some expectations that its sales will exceed its own forecast, and it is positive news," said Kenneth Lee, vice president of research department at Taiwan's Fubon Securities Investment Services.

"We are not worried about their orders in April and May," said Lee, who expected TSMC's second-quarter sales to grow about 40-50 percent from the first quarter.

"But technology shares have risen a lot recently and we are not sure about their orders after June."

For a Q+A story on Taiwan tech shares, click [ID:nTP30237]

On a consolidated basis, TSMC reported sales of T$39.50 billion in January-March, down 55 percent from a year ago, the company said in a statement on Friday, without giving details.

First-quarter sales declined 39 percent from the fourth quarter, according to Reuters calculations.

TSMC's first-quarter sales were above a revised forecast in early March of between T$36 billion and T$38 billion. They also beat an average T$36.4 billion forecast by Reuters Estimates.

TSMC announced the results after the Taipei stock market closed on Friday. TSMC shares rose 1.2 percent, underperforming the main TAIEX's <.TWII> 2 percent gain. UMC shares were flat.

http://sg.news.yahoo.com/rtrs/20090410/ ... bb44c.html

[winston]

PREVIEW-TSMC Q1 net to fall; UMC, Chartered to post losses

* What: TSMC, UMC, Chartered Semi Q1 results
* When: Chartered (Apr 24), UMC (Apr 29) and TSMC (Apr 30)
* Q1 results seen poor, but upturn seen in Q2

By Baker Li TAIPEI, April 22 (Reuters) - Top contract chipmaker TSMC <2330.TW> probably booked its weakest profit in nearly 8 years in the first quarter, and smaller rivals UMC <2303.TW> and Chartered saw another quarter in the red on poor chip demand.

The chip foundry market is however bottoming out, partly driven by China's massive stimulus spending, that has triggered fresh demand for microchips used in personal computers, mobile phones and televisions.

Last week, chip giant Intel Corp said PC sales had bottomed out and Texas Instruments posted a surprise quarterly profit on Monday as demand improved in Asia, including China. [ID:nN14455703] [ID:nN20403813] "China seems to be a key driving force recently and foundries are among the major beneficiaries," said Alex Huang, vice president of Taiwan's Mega International Securities.

Some analysts say Taiwan's close economic ties with neighbour China, which is showing signs its economy may have bottomed out, could help the island recover faster than its regional peers.

"But it is not out of the woods yet because we are still expecting the U.S. and Europe to catch up," Huang said.

Taiwan Semiconductor Manufacturing Co Ltd (TSMC) is likely to report a net profit of T$1.2 billion ($36 million) for January-March, according to the mean forecast of six analysts surveyed by Reuters.

(For more results forecasts, see table below) This week, Deutsche Bank said Qualcomm and Mediatek <2454.TW> should increase chip orders for new-generation cellphones from TSMC in the second quarter. The brokerage more than doubled its 2009 EPS forecast on TSMC. [ID:nTP341116] Goldman Sachs forecast TSMC and UMC's second-quarter revenue would jump 61 percent and 80 percent, respectively, while Singapore-based rival Chartered Semiconductor Manufacturing is set to see a 55 percent sequential rise in its second-quarter sales.

Investors are already betting on a recovery, pushing TSMC's Taipei-listed shares to a six-month high in April. UMC shares hit their highest level in nearly 8 months this month.

Q1 PROFIT FORECASTS Net profit/loss Change (pct) Y/Y Q/Q TSMC T$1,200 mln -96 -90 UMC (T$5,781 mln) -- -- Chartered ($147.2 mln) -- -- NOTE - Both UMC and Chartered booked profits in the first quarter of 2008 and saw losses in the fourth quarter of 2008.

[winston]

Global semiconductor sales slumped 30% in March from a year earlier as the industry continues to suffer through its sharpest downturn in years.

The first quarter's drop was the same, the Semiconductor Industry Association said, as consumer demand for electronics and other products wanes amid the recession. In response, companies making items with semiconductors have slashed their production and supply inventories.

But the month's $14.67 billion in sales for March was up 3.3% from February, with every region of the world except Japan showing growth.

SIA President George Scalise said the "modest" increase "suggests that demand has stabilized somewhat, albeit at substantially lower levels than last year."


– Wall Street Journal

[winston]

Global chip foundry sales to rise in Q2 - iSuppli

TAIPEI, June 9 (Reuters) - Global revenue in the chip foundry market is expected to post a sequential rise in the second quarter after three quarters of declines, but 2009 will remain challenging for foundries, market search firm iSuppli said.

Global revenue for foundries, or contract chipmakers, including sector leaders TSMC <2330.TW>, UMC <2303.TW> and Chartered Semiconductor , was set to rise to $3.6 billion in the second quarter, iSuppli Corp said in a statement seen by Reuters on Tuesday.

That would be an increase of about 60 percent from the first quarter's $2.25 billion, iSuppli said.

"The foundry market in the second quarter is benefitting from both a major reduction in semiconductor inventories throughout the electronics supply chain and innovative new designs requiring innovative technology," said Len Jelinek, director and principal analyst, semiconductor manufacturing, for iSuppli.

TSMC and UMC , which iSuppli said took a combined 63 percent share of the foundry market in the first quarter, have forecast a bright second quarter, partly on strong demand from China, as a result of stimulus spending on the mainland.

[winston]

PREVIEW-TSMC Q2 net seen stronger; UMC to turn around

* What: TSMC, UMC, Chartered Semi Q2 results
* When: Chartered (July 24), UMC (July 29) and TSMC (July 30)
* Q2 results seen stronger than Q1

By Baker Li TAIPEI, July 22 (Reuters) - Top contract chipmaker TSMC <2330.TW> probably made its largest profit in three quarters in the second quarter, while money-losing rival UMC <2303.TW> could have returned to the black thanks to growing demand.

Sales of chips used in personal computers, mobile phones and flat-screen TVs could gather speed, partly on back-to-school demand into the third quarter, while Taiwan Semiconductor Manufacturing Co (TSMC) may further expand its share of the $20 billion chip foundry market.

The world's two biggest foundries, which supply chips to fabless chip designers and chipmakers that are stepping up outsourcing to cut costs, have benefitted from China's massive stimulus package since early this year that has fuelled consumer spending on electronic devices.

Analysts say cash-rich companies such as TSMC usually have the ability to spend more on new, more cost-effective production technologies, while second-tier rivals, including Singapore-based Chartered Semiconductor and China's SMIC <0981.HK> have limited research spending.

"TSMC has been in the driving seat in migrating to advanced technologies and that's why I always have confidence in its business," said Andrew Deng, an assistant vice-president at Taiwan International Securities. "In terms of orders, visibility is clear for the third quarter for the overall foundry market."

TSMC is expected to ship more graphics chips made by new 40-nanometre process technology to its clients, including Nvidia and AMD , in the third quarter, according to Deutsche Bank.

News from some big semiconductor makers in the United States has been upbeat -- Intel's quarterly results and outlook exceeded analysts' forecasts last week on improved consumer demand for PCs [ID:nN14260734], while Texas Instruments (TI) also posted a stronger-than-expected profit and outlook on Monday.

[ID:nB86748] TSMC is expected to report a net profit of T$23.3 billion ($710 million) in April-June, sharply higher than first quarter's T$1.56 billion, while UMC could become profitable after three quarters of losses, according to the mean forecast of five analysts surveyed by Reuters.

Chartered Semiconductor could post its fourth straight quarterly loss in the second quarter, although the loss could narrow from the previous three months.

(For more results forecasts, see table below) So far this year, TSMC's Taipei-listed shares have risen about a quarter and UMC shares are up 72 percent, compared with the main TAIEX's <.TWII> 51 percent gain in the same period.

"This has been a better time to make money on foundry stocks," CLSA wrote in a Monday report.

"We find industry bluechip TSMC and inexpensive UMC geared for a cyclical recovery, and rate both 'outperform'," CLSA said.

It rated Chartered Semiconductor a "sell".

After a strong second quarter when sales jumped 88 percent sequentially to T$74.21 billion, TSMC's third-quarter sales are widely expected to grow by a smaller 5-10 percent from the second quarter.

Q2 PROFIT (LOSS) FORECASTS Net profit/loss Change (pct) Y/Y Q/Q TSMC T$23,300 mln -19 +1394 UMC T$1,036 mln -57 -- Chartered ($56.2 mln) -- -- NOTE - Both UMC and Chartered lost money in the first quarter of 2009, while Chartered saw profits in the second quarter of 2008.

[winston]

Taiwan's TSMC Q2 net profit soars

Taiwan Semiconductor Manufacturing Co. said Thursday that net profit soared to 24.44 billion Taiwan dollars (744 million US) in the second quarter, helped by strong demand for microchips. TSMC, the world's leading contract microchip maker by revenue, also raised its outlook for the third quarter. The figure for the three months to June represented a 15 percent drop from the same period a year ago, but a sharp improvement on the profit of 1.56 billion Taiwan dollars seen in the previous quarter.

Earnings per share rose to 0.94 Taiwan dollar in the quarter, up from 0.06 in the previous quarter but down from 1.09 a year earlier. "As a result of improved demand outlook, customers' companies launching new products and customers restocking, (the) second quarter saw a sharp rebound in the demand for semiconductors," the company said in a statement.

TSMC produces chips for a range of uses including communications equipment and computers and consumer products. Second-quarter sales came in at 74.21 billion Taiwan dollars, up from 39.5 billion the previous quarter but down from 88.14 billion in the same period a year ago. "The sales figure is better than our previous estimate of 10 percent growth from the previous quarter," said Michael Yeh of Taiwan Life Asset Management. "It indicated that the company has regained a strong growth momentum in the quarter," he told AFP.

Like its rival United Microlectronics Corp, TSMC also expected sales growth to last into the third quarter. "Both our macroeconomic forecast and booking trend indicate that we will have a good third quarter," said Lora Ho, company chief financial officer. The company forecast sales revenues of 88 billion-90 billion in the third quarter.

http://sg.biz.yahoo.com/090730/1/4pn9m.html

[winston]

TSMC sees Q4 revenue growing from Q3-report

TAIPEI, Sept 19 (Reuters) - TSMC <2330.TW>, the world's largest contract chipmaker, expects revenue in the fourth quarter to grow compared to the current three-month period, local media reported on Saturday, citing company chairman Morris Chang.

The Chinese-language Commercial Times newspaper also reported that chip designers Qualcomm and Nvidia had visited contract manufacturers such as TSMC recently, without saying where it got the information from.

Chang's estimates would be better than market expectations, with analysts polled by Reuters expecting revenue in the fourth quarter to slip about 10 percent to T$81 billion ($2.5 billion).

TSMC had said in late July it expected revenue of T$88-90 billion in the July-September quarter as demand for chips grows and the global economy recovers. [ID:nTP261512]

TSMC has been ramping up production of new chips this year by using more advanced, efficient technology. It is also benefitting as major chipmakers in the United States, Europe and Japan increasingly outsource production to foundries.

Some analysts are also expecting a further consolidation in the sector that is emerging from its worst downturn after Abu Dhabi's state-owned ATIC offered to buy Singapore's Chartered Semiconductor earlier this month.

Source: Kelvin Soh, Reuters

[winston]

Global chip sales will rise in 2010-research house

* Sees chip sales down less than expected in 2009
* Sees sales returning to growth in 2010

SAN FRANCISCO, Sept 30 (Reuters) - Global semiconductor sales will decline less than previously forecast this year and will return to growth in 2010, tech research house iSuppli said on Wednesday.

Worldwide chip sales are now forecast to decline 16.5 percent this year to $216.1 billion, compared with a previous forecast for a 23 percent drop, iSuppli said.

The semiconductor industry has been pummeled by a global recession that has drastically weakened corporate IT spending and hurt demand for everything from computers to cell phones.

But analysts point to signs of stabilization and a possible recovery. Semiconductor sales in the second quarter were strong compared with the first quarter, and there is improving supply chain visibility and demand, iSuppli said.

China's stimulus package boosted consumer spending in the second quarter, while the U.S. stimulus package has yet to have had a significant impact, it said. Third-quarter semiconductor sales are rising on improved market outlooks from manufacturers for computers and handsets, it added.

Semiconductor revenue is forecast to grow on a year-on-year basis beginning next May, and overall 2010 revenue is expected to rise 13.8 percent to $246 billion, it said.

If chip sales do not grow on a year-on-year basis until next May, that would mean 20 straight months without growth in semiconductor revenue, longer than the 17 months the industry went through during the last major downturn from 2001 to 2002.

Annual growth is not expected to return to pre-downturn levels until 2012, when revenue is expected to hit $282.7 billion, according to iSuppli.

Source: Clare Baldwin; Reuters

[winston]

UPDATE 1-UMC posts solid Sept sales but Q4 seen slow

* UMC sales hit two-year high in September
* Q4 sales seen slow after strong Q3
* UMC, TSMC stocks fall before results (Recasts, adds details)

By Baker Li TAIPEI, Oct 8 (Reuters) - Solid September sales at UMC <2303.TW>, the world's No.2 contract chipmaker, showed stronger demand for technoology products that could have helped the Taiwan company book a bigger profit in the third quarter.

However, analysts have widely expected UMC's fourth-quarter sales to be flat or to decline slightly from the strong third quarter even though it ramped up production of new chips by using more efficient technology to cut costs.

United Microelectronics Corp (UMC) said on Thursday it recorded sales of T$9.536 billion ($297 million) last month, up 18 percent from a year earlier, to the highest level in two years.

"UMC faces the risk of larger order cuts from October as many of its key local fabless customers could see a larger drop in demand in October to December," Citi semiconductor analyst Andrew Lu said in a Wednesday report.

Around 60 percent of UMC's sales come from chips for communications products, such as mobile phones, and the company sells nearly 80 percent of its chips to fabless chip companies, including Mediatek Inc <2454.TW>.

"TSMC, to stop overflow orders to competitors, and Globalfoundries, striving to be No.2 foundry globally, are both expected to be aggressive in adding capacity and cutting wafer prices to compete against UMC in 2010," Lu said.

Source: Reuters