Thursday, August 28, 2014
Search
  
Submit your own News for
inclusion in our Site.
Click here...
Breaking News
UMC To Partner With Fujitsu On Chip Production
Samsung, LG Introduce New Smartwatches
Sharp, Pioneer Dissolve Their Capital Alliance
Nero 2015 is Coming At IFA
LaCie Ships the 48 TB Thunderbolt 2 Storage Solution
ALCATEL ONETOUCH Launches New Affordable Smartphones
ZOTAC Debuts the ZBOX PI320 pico
Dropbox Now Offers 1TB Pro plan for 10 Dollars
Active Discussions
help questions structure DVDR
Made video, won't play back easily
Questions durability monitor LCD
Questions fungus CD/DVD Media, Some expert engineer in optical media can help me?
CD, DVD and Blu-ray burning for Android in development
IBM supercharges Power servers with graphics chips
Werner Vogels: four cloud computing trends for 2014
Video editing software.
 Home > News > General Computing > Foundri...
Last 7 Days News : SU MO TU WE TH FR SA All News

Thursday, October 03, 2013
Foundries Spending Big on Capital Equipment


Semiconductor capital spending has increased significantly among pure-play foundries as more IDMs shift to a fabless/fab-lite business model and as new foundry participants intensify competition among the old guard.

IC Insights forecasts that the total capital outlays by the Big 4 pure-play foundries - TSMC, UMC, GlobalFoundries and Samsung - will be $16.6 billion in 2013, which would represent 53% of their combined sales. This far exceeds the industry average of 18% capital-spending-to-sales ratio. The Big 4?s capital spending as a percent of "final sales" is forecast to be 24% in 2013, still well above industry average.



A few years ago, TSMC stated that it planned to keep its capital spending at about 20% of its sales, but that was before GlobalFoundries and Samsung brought competitive pressure to the market and started chipping away at TSMC's business. TSMC spent $5.9 billion in capital spending in 2010 (a budget that was increased twice in the first half of the year), an all-time record amount of capital spending for the company at that time. TSMC spent $8.3 billion in capital expenditures in 2012 and plans to further increase its capex spending to $10.0 billion in 2013. It appears that TSMC will be aggressive in its marketshare fight with GlobalFoundries and Samsung and is likely to greatly exceed its 20% of sales goal for capital spending outlays over the next few years.

The question with regard to the expected combined 2011-2013 IC foundry spending by the Big 4 pure-play suppliers ($46.3 billion) is whether it is too much. As shown in the above table, the "final sales" capital-spending-to-sales ratio of the major foundries was a relatively low 14-15% in 2005-2007 before falling to only 9% in 2008 and 12% in 2009. In 2010, this figure rose to 23%, a level not seen since the boom year of 2004. Spurred by the surge in capital spending by TSMC and GlobalFoundries, this figure rose to 30% in 2011. For 2012, the capital spending as a percent of sales figure for the Big 4 foundries dropped back to a more "reasonable" 24%, with the same percentage expected for 2013.

"Given the major foundries high capacity utilization levels for leading-edge device production, it appears that current spending levels are warranted and should not lead to significant overcapacity issues," according to IC Insights.

With demand for IC foundry services from fabless and fab-lite IDM companies expected to be high over the next five years, there is little doubt that demand for IC foundry production will remain strong. Overall, IC Insights believes that the pure-play foundry market will further divide into the leading-edge IC foundries like TSMC, GlobalFoundries, UMC, and Samsung, and the specialty foundries like TowerJazz, X-Fab, etc. Thus, the vast majority of future foundry capital spending can still be expected to come from the small group of major foundries targeting leading-edge IC production.



Previous
Next
TDK Showcases Ultra-thin Transparent Conductive Film For Touch Panels        All News        Rovi Introduces HTML 5 Cloud Powered EPG
Google Buys Gesture Recognition Start-up Flutter     General Computing News      Cisco and Facebook To Offer Wi-Fi Check-out Promotions At Stores

Get RSS feed Easy Print E-Mail this Message

Related News
UMC To Partner With Fujitsu On Chip Production
IBM Talks With Globalfoundries Stall Over Price: report
TSMC Losses Chip Orders From Apple, Qualcomm: reports
TSMC Q2 profit Increased, 20nm Chips Start Shipping
TSMC Reports Strong Q2 Sales
TSMC Aims At 10nm Chip Production By 2016
UMC To Start 14nm Trial Production Next Year
IBM May Sell Chip-Making Unit to Globalfoundries: report
GLOBALFOUNDRIES Introduces 55nm Automotive-Specific Semiconductor Manufacturing Platform
Toshiba Joins GLOBALSOLUTIONS Ecosystem
Samsung Works With GLOBALFOUNDRIES On 14 nm FinFET Offering
TSMC Reports Quarterly Profit

Most Popular News
 
Home | News | All News | Reviews | Articles | Guides | Download | Expert Area | Forum | Site Info
Site best viewed at 1024x768+ - CDRINFO.COM 1998-2014 - All rights reserved -
Privacy policy - Contact Us .