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© IC Insights Analysis | September 09, 2022

TSMC to pass Samsung in semiconductor company sales ranking

With the memory market currently in a free-fall, IC Insights expects foundry giant TSMC to surpass Samsung and take over the top spot in the semiconductor company sales ranking in 3Q22.

IC Insights says that Intel is expected to move to the third position in the ranking – with 3Q22 sales that are 26% less than TSMC’s. Just to illustrate how quickly TSMC has risen to the top, the Taiwanese company was ranked as the third largest semiconductor supplier in the world in 2021 and had sales that were 31% less than Samsung’s.

The sheer magnitude of TSMC’s semiconductor sales comes more into focus when one considers the “final” sales of the company, as IC Insights points out.  The “final” sales figure for a pure-play foundry like TSMC is about 2x the total foundry sales number. The 2x multiplier estimates the semiconductor sales amount sold to the final customer (i.e., the electronic system producer).  For example, fabless company AMD purchases processors from TSMC but AMD is not the final end-user of these devices. AMD resells these processors to electronic system producers at a much higher price than it paid TSMC for the parts. As a result, a 2x multiplier, which assumes a 50% gross margin for the foundry’s customers (e.g., AMD), can be used to arrive at a “final” semiconductor market sales figure for TSMC.

Using a “final” sales figure estimate for TSMC puts its 2021 semiconductor sales at USD 113.7 billion and USD 40.4 billion for 3Q22. To put the company’s “final” 2021 semiconductor sales figure into perspective, at USD 113.7 billion, TSMC’s “final” sales are estimated to have represented 18.5% of the world’s semiconductor market last year. Moreover, IC Insights believes that this percentage has a good chance of rising to 25% in 3Q22.

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September 29 2022 3:24 pm V20.8.40-2
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