LONDON Ė Although foundry Taiwan Semiconductor Manufacturing Co. Ltd. suffered a third quarter that was down sequentially against its second quarter, the company is starting to see signs of a turn in the market, according to its leading European executive.
This is partly because concerns about the global economic situation during 2011 has caused electronic equipment and chip companies to strive to burn off inventory, and that process has now reached close to a minimum, according to Maria Marced, European president of TSMC.
Marced said she expects TSMC to demonstrate an improving gross margin in the fourth quarter and to come out of 2011 with revenues up 9 percent on what the company achieved in 2010. This growth would be against the back drop of a global semiconductor industry that TSMC's expects to grow 1 percent versus 2010. The TSMC estimate is in line with EE Times' forecast of market growth of between 0 and 2 percent (see Analysis: Strong September boosts 2011 chip forecast).
However, globally uncertainties, not least the European debt crisis, are set to continue into 2012 and are likely to continue to suppress spending in a number of electronics sectors. Marced said that TSMC therefore has made an estimate of a 3 to 5 percent global annual chip market growth in 2012.
"The macro-economics are not good. But the cloud, mobile internet and internet-of-things are stimulating our industry," Marced told EE Times. "45 days of inventory is significantly low. Distributors are now starting to rebuild inventory. We are starting to see rush orders for December," said Marced.
Marced said the supply chain pipeline is so empty the market can only turn in one direction, stimulated by resilient demand in sectors related to mobile and internet applications.
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