SAN FRANCISCO—Fabless semiconductor vendor Qualcomm Inc. moved to the No. 5 position among chip sellers in the first quarter, surpassing Texas Instruments Inc., among others, according to market research firm IC Insights.
Qualcomm's first quarter semiconductor sales total of $3.06 billion was up 56 percent compared to the first quarter of 2011. The strong year-over-year increase was partially attributed to Qualcomm's acquisition of Atheros Communications Inc., which closed in the second quarter of 2011.
No other chip vendor in the top 10 recorded year-to-year growth in chip sales in the first quarter, according to IC Insights (Scottsdale, Ariz.).
IC Insights attributed Qualcomm's first quarter performance largely to strong sales of smartphones, many of which feature Qualcomm chips. Qualcomm is on pace to register over $12 billion in sales this year, IC insights said.
Intel Corp. remained far and away the biggest chip supplier in the first quarter, IC Insights said. Intel expanded its lead over No. 2 chip vendor Samsung Electronics Co. Ltd., with 68 percent higher sales than Samsung in the first quarter, up from 48 percent for all of 2011, IC Insights said.
Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) remained the leading foundry by a wide margin in the first quarter with sales of $3.57 billion. TSMC maintained its No. 3 ranking overall among chip sellers, according to IC Insights' ranking, part of the May update to the market watcher's McClean report.
Globalfoundries Inc., now the second largest pure play foundry, moved into the top 20 among chip sellers for the first time in the first quarter, IC Insights said. With first quarter sales of $840 million, Globalfoundries was ranked No. 19 among chip sellers overall, according to IC Insights.
United Microelectronics Corp. (UMC) held its No. 20 position in the rankings despite posting a year-to-year decline of 16 percent in first quarter sales, according to IC Insights. The first quarter of the year was the first time that three pure play foundries ranked in the top 20 in any single quarter, according to IC Insights.
Globalfoundries' move into the top 20 displaced Japan's Elpida Memory Inc., which filed for bankruptcy protection earlier this year. Elpida's sales for the quarter declined by 34 percent compared to the first quarter of 2011, IC Insights said.
We have always looked at the ranking as a top supplier list, not as a marketshare ranking and realize that the sales are double counted. With many of our clients being vendors to the semiconductor industry (equipment, chemicals and gases, etc.), leaving out large IC manufacturers like the foundries would leave gaping holes in the list of top suppliers. We state up front that we include the foundries so that you can take them out if you want and we also identify which suppliers are fabless. When we construct marketshare rankings of semiconductor companies we do not include the foundries so as not to double count the sales.
It should be noted that not all foundry sales should be excluded when attempting to create marketshare data. Although Samsung has foundry sales, most of its foundry sales are to Apple. Since Apple will not re-sell these devices, counting these foundry sales as Samsung sales does not introduce double-counting.
Overall, the list is only provided as a guideline for who are the top semi producers whether they be IDMs, fabless companies, or foundries. You can always segment the market in a lot of other ways if you desire.
Bill McClean, President, IC Insights
I don't quite understand IC Insights' rationale for including the pure play foundries in the rankings. When the top fabless companies are doing very well -- Qualcomm and Broadcom for example -- their success automatically lifts TSMC higher.
In terms of counting total sales for the top 20, it's essentially a form of double counting where the foundries sell to the fabless guys, who then sell to OEMs...and the same silicon gets counted twice.
This is showing everyone the power of mobile and what it can do in any industry (chip, app, software, etc). It is interesting how this firm is doing. They need to hope something sustains the smartphone market where they have a lot of influence.
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