Taiwan's semiconductor industry is likely to generate revenue totaling NT$2.09 trillion (US$69.9 billion) this year, up around 11.1% from last year mostly thanks to steady demand from makers of PCs and smartphones, according to Taiwan Semiconductor Industry Association (TSIA) and Industrial Economics & Knowledge Research Center (IEK) of the government-backed Industrial Technology Research Institute (ITRI), which set the annual growth rate for the global semiconductor industry at 3.6% this year.
A survey by the two organizations shows that although the Taiwan industry's revenue for the fourth quarter of last year sank 3.4% from the previous quarter, its revenue for the entire year surged 15.6% year on year, to NT$1.8 trillion (US$62.9 billion) in 2013, compared with the 4.8% increase for the global semiconductor industry.
The two organizations ascribe the decrease mostly to seasonal inventory adjustments at the island's silicon foundry suppliers. Nevertheless, the Q4 result represented an increase of 18.1% from the same quarter of 2012.
In the fourth quarter, the island's silicon foundry sector saw revenue decrease 9.8% from the previous quarter, to NT$185.8 billion (US$6.1 billion), whereas local IC design sector registered a 0.1% growth, to NT$129.2 billion (US$4.3 billion). Local memory chip sector surged 7.9% sequentially, to NT$69.3 billion (US$2.3 billion), due to price hikes in DRAM market caused by a fire at SK Hynix Semiconductor Inc.'s Wuxi plant in China.
Throughout last year, Taiwan's memory chip sector posted revenue growth of 31.2% year on year, to NT$237.3 billion (US$7.9 billion), becoming the highest-growth segment of the island's semiconductor industry. Its foundry sector generated revenue of NT$759.2 billion (US$25.3 billion), rising 17.1% year on year mostly thanks to the unmatched dominance worldwide by Taiwan Semiconductor Manufacturing Co. (TSMC) in supplying 28nm process foundry service. Thanks to brisk shipments at design house MediaTek Inc., Taiwan's IC design sector saw revenue surge 16.9%, to NT$481.1 billion (US$16 billion).
The two organizations point out that regardless of the robust growth of the island's IC foundry and memory-chip sectors, local IC testing and packaging sectors failed to grow as fast, with the testing sector increasing only 4.2% to NT$126.6 billion (US$4.2 billion) and the packaging sector adding only 4.6% to NT$284.4 billion (US$9.4 billion).
Industry executives ascribe the slow growth of testing and packaging sectors mostly to the significant reduction in demand for PC chips, which offset the brisk demand for smartphone chips.
TSIA and IEK estimate the island's IC design sector to generate revenue of NT$542.5 billion (US$18 billion) this year, rising 12.8% from last year; its IC foundry sector to generate revenue of NT$853 billion (US$28.4 billion), growing 12.4% from last year; and its memory chip sector with revenue of NT$258 billion (US$8.6 billion), adding a relatively moderate 8.7% to predicted decline in DRAM prices. Local testing and packaging sectors are expected to grow at least 8% respectively. (KL)
Taiwan's Semiconductor Industry Revenue (2012-2014)
|| 2012/2013 growth
|| 2014 estimates
|| 2013/2014 growth (e)
| Total revenue
| IC design revenue
| IC manufacturing revenue
| IC foundry revenue
| Memory chip revenue
| IC packaging revenue
| IC testing revenue
| IC product revenue
| Growth rate for global semiconductor industry
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