This growth took place as there was not a massive reduction in wafer start orders in 1Q20, while foundry clients expanded their orders in 2Q20 due to both increased production of existing devices and new applications generated by the COVID-19 pandemic. The comparatively low base period in 2Q19 also contributed to the YoY increase in foundry revenue in 2Q20.
posted revenue growth of more than 30% YoY in 2Q20 thanks to stable demand for products made with its legacy process technologies, as well as new demand for 5G smartphone APs, HPC, and WFH-use CPUs/GPUs, which contributed to the company’s revenue from advanced process technologies. With regards to the impact of U.S. sanctions on Huawei
, which is one of TSMC’s major clients, the sanctions are expected to affect TSMC’s capacity utilization rates to only a very limited degree because the foundry’s other clients, including AMD
, and Qualcomm
, had already managed to plan wafer start orders at TSMC.
Owing to good customer adoption rates of 5G smartphones featuring Qualcomm’s mid-range and high-end 7-series Snapdragon 5G platforms, the demand for Samsung’s 7nm process technology was relatively stable. Samsung
expanded its supply of CIS and DDIC due to an expected increase in the penetration rate of 5G smartphones. The Korean foundry also increased the EUV capacity at its Hwaseong fab, in turn expanding its product applications outside of the mobile business. Samsung’s revenue is expected to increase by 15.7% YoY in 2Q20. GlobalFoundries, however, was affected by the waning demand for automotive chips and microprocessors. GF may therefore see limited space for YoY revenue growth in 2Q20, which is projected to reach 6.9%.
Due to increased demand for driver IC and other pandemic-related products, UMC’s revenue is expected to reach a double-digit YoY increase of 23.9% in 2Q20. As for SMIC
, demand for products made from 12-inch wafers, such as NOR Flash and eNVM, as well as 8-inch wafers, such as PMIC, fingerprint sensor chips, and some general-use MCUs, was able to sustain SMIC’s revenue performance, projected to reach 19% increase YoY in 2Q20. But the U.S. sanctions on Huawei may introduce variables potentially affecting SMIC’s capacity utilization going forward.
In terms of third-tier foundries, TowerJazz
’s revenue from RF and silicon photonics transceiver products benefitted from ongoing demand for 5G infrastructure and data center constructions, but the total sales of these products could not compensate for the reduction in consumer electronics products, meaning TowerJazz may find it somewhat difficult to maintain a high capacity utilization rate. Furthermore, despite the strong demand for CIS products, the future of automotive product demand remains yet unclear. TrendForce thus takes a conservative view towards TowerJazz’s overall revenue in 2Q20, which is projected to reach a 1.3% increase YoY.
’s revenue growth mostly took place because of demand for CIS products, including IP cameras, entry-level and mid-range smartphone CIS chips, and entry-level CIS for security and surveillance cameras, all of which experienced stable growth in China. In addition, PSMC’s revenue performance in 2Q19 resulted in a relatively low base period for comparison, meaning the foundry’s revenue is expected to increase by about 70% YoY in 2Q20. On the other hand, VIS is expected to reach an 18.9% YoY revenue growth in 2Q20, thanks to increased demand for large-sized display panel DDIC from its Chinese clients and demand for PMICs used in servers and data centers.
has been focusing on the development of 12-inch wafer capacity and promoting its 90nm products, including CIS, eFlash, RF and power semiconductors. As such, Hua Hong’s production capacity is currently still expanding. But Hua Hong’s relatively high base period in 2Q19 means its revenue is expected to undergo a slight 4.4% YoY decrease in 2Q20. DB HiTek saw massive DDIC and CIS demand from its Korean clients, which is expected to help its revenue reach a 4.6% increase YoY in 2Q20. Since TrendForce considers this wave of demand to be a preemptive stock-up measure by clients against a possible component supply shortage, DB HiTek’s future client demand still remains to be seen.
TrendForce indicates that the pandemic has galvanized the foundry clients’ demand for wafer starts by generating a change in end-product applications and by compelling the clients to stock up on chips related to those applications, in turn stabilizing the major foundries’ production plans for 2Q20. Even so, this wave of stock-up demand may potentially slow down, as it is constrained by clients’ inventory adjustment strategies. Furthermore, the ongoing trade tension between China and the U.S. means not all foundries have benefitted from the wave of demand, and the increased demand in 2Q20 does not represent a revenue driver capable of supporting the overall foundry industry in the long term. Therefore, the foundry market may yet face uncertainties in 2H20.
Ranking of the Global top 10 foundries by revenue 2Q20
|Top 10 total||18,903||15,359||23.1%||96.4%