The Tech week that was... June 5 ~9

Welcome to the latest edition of my weekly newsletter bringing you all the key semiconductor and technology news from around the world in one easy read. 

This week there is lots of new Fab news from around the world, all the latest Taiwan Foundry and OSAT revenue data from May, the latest market research reports on global semiconductor sales and equipment sales plus much much more.

France has announced it will provide US$3.10 billion in state subsidies for STMicroelectronics and GlobalFoundries new US$8billion Fab in Crolles, France. The US$3.1billion subsidy is part of the US$5.9billion package France has set aside for its investments in the microchip sector by 2030. The Fab which was first announced July last year, will be located next to STM's existing plant in Crolles and targeted to reach full capacity by 2028, with up to 620,000 wafers per year of production with technology down to 18nm. As a result of receiving the subsidy GlobalFoundries and STMicroelectronics have finalized the agreement for the new joint 300mm Fab.

STMicrolectronics and Sanan Optoelectronics will create a new Joint Venture to manufacture high volume 200mm SiC devices in Chongqing, China. The new Sic Fab is targeted to start production in Q4 2025 and reach full capacity in 2028. The JV will support rising demand for STMicroelectronics SiC devices in China for car electrification and industrial power and energy applications. Separately Sanan will build a 200mm SiC substrate manufacturing facility to fulfil the JV’s needs.

TSMC have announced the opening of it’s new packaging and testing fabrication plant in Miaoli, northern Taiwan. TSMC’s Backend Fab6 is TSMC’s largest backend advanced Fab to date and the facility is TSMC's first all-in-one automated fab, and is estimated to have an annual production capacity of more than 1 million 12-inch wafer equivalent 3DFabric process technology, and more than 10 million hours of testing services.

 At it’s annual general meeting TSMC confirmed to shareholders that it intends to establish a joint venture Fab in Germany focused on automotive customers  It may follow the same model as the JV in Japan, and TSMC intends to hold the majority stake in the venture. TSMC also said it is evaluating the feasibility a 2nd Fab in Japan, but said it has no plans for an advanced packaging plant in the US, as the company plans to keep advanced packaging plants in Taiwan.

 The EU has approved US$8.7 billion on state aid for 68 research and development projects into materials and tools, as well as chip design and manufacturing processes. 56 companies will benefit from these subsidies. They target 5G and 6G telecoms technology, along with autonomous driving, artificial intelligence (AI) and quantum computing.

However semiconductor manufacturer Nexperia was denied a German subsidy for a project using semiconductors to help batteries run more efficiently. Nexperia headquartered in the Netherlands and which is owned by Chinese company Wingtech was not given a reason.

Toshiba’s board has decided to recommend to shareholders to tka up the tender offer lead by Japan Industrial Partners, helping pave the way for a $14 billion buyout to take the Japanese conglomerate private.

Foundry & OSAT revenue news..

This week the Taiwan foundries and OSAT's released their May revenue reports. Whilst there are some glimmers of hope in the results, overall there are still no strong signs of recovery.

TSMC saw a 4 month high in revenue for May reporting revenue of US$5.76 billion, up 19% compared to April. This still represents a -5% YoY decline. For the year to date TSMC’s revenue of US$27billion is down -1.9% compared to the same period last year. TSMC is believed to be on track to hit is Q2 guidance of US$15.6billion. TSMC said at it’s recent shareholder meeting that it believes that the semiconductor market, excluding memory, will see a decrease by -4 ~ -6% in 2023, while revenue in the foundry segment will decline by -7 ~ -9%. TSMC expects to outperform the market registering a low to mid single-digit decrease in revenue.

UMC also saw it’s revenue increase for the 3rd consecutive month in May to US$612million, up 1.7% sequentially. As with TSMC revenue is down compared to last year, UMC are down -23% YoY for May. For the first 5 months of 2023, revenue was US$2.98billion which is down -17.4% compared to the same period last year.

Specialist 8”foundry Vanguard (VIS) didn’t fare so well in May, reporting revenue ofUS$102million, down -12% sequentially and down -41% YoY. For the year to date VIS’s revenue of US$485million is. Approx. down -36% compared to the same period last year.

Foundry Powerchip also reported a decline in revenue in May, reporting a revenue of US$121million, down -4% sequentially and down -50% YoY. For the first 5 months of 2023, total revenue is US$620million, down -50% yoy.

In the BE, OSAT ASE reported revenue of US$856million in May  for it’s ATM group (includes OSAT’s ASE & SPIL), up 11.5% sequentially and down -20% yoy.

OSAT PowerTech (PTI) reported May revenue of US$185million, up 1% sequentially and down -28% YoY. For the year to date revenue is US$881million, down -25% YoY

Test OSAT KYEC reported May revenue of US$90million, up 5.5% sequentially and down -17% Yoy. For the year to date revenue is US$428million, down -16% YoY.

In the latest market research news..

According to SEMI, global semiconductor equipment billings were US$26.8 billion in Q1 2023, this is up 9% YoY but down -3% sequentially. Ajit Manocha, SEMI president and CEO said “Semiconductor equipment revenue in the first quarter was robust despite macroeconomic headwinds and a challenging industry environment,” and said that “the fundamentals remain healthy for the long-term strategic investments needed to support major technology advancements for AI, automotive, and other growth applications.” Taiwan lead the billings followed by China and Korea.

Global semiconductor industry sales were $40.0 billion in April 2023, up 0.3% sequentially but down -21.6% YoY according to the latest data from World Semiconductor Trade Statistics (WSTS).   In WSTS’s latest forecast it predicts global semiconductor sales will decrease -10.3% to US$515billion in 2023 before rebounding 11.9% to US$576billion in 2024. John Neuffer, SIA president and CEO said “The global semiconductor market remains in a cyclical downturn, exacerbated by sluggish macroeconomic conditions, but month-to-month sales ticked up for the second consecutive month in April, perhaps foreshadowing a continued rebound in the months ahead”

Smartphone production fell to a 10year quarterly low of 250million units in Q1 2023 according to the latest data by Trendforce. Trendforce is predicting production will increase 5% in Q2 to 260million units. Samsung took top position with 24.6% marketshare from Apple

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Stay safe and healthy... bye