LONDON Ė Foundry Taiwan Semiconductor Manufacturing Co. Ltd has reported strong sequential and annual sales growth in May while smaller rival United Microelectronics Corp. reported a year-on-year decline in sales both in May and for the year to date.
TSMC (Hsinchu, Taiwan) has announced that its net sales for May 2012 on an unconsolidated basis were NT$43.62 billion (about $1.48 billion), an increase of 9 percent over April 2012 and an increase of 21.3 percent over May 2011. On the same basis revenues for January through May 2012 totaled NT$187.88 billion (about $6.28 billion), an increase of 7.5 percent compared to the same period in 2011.
When it is considered that in April TSMC's unconsolidated sales were 10.4 percent ahead of April 2011 it can be seen that TSMC is now pulling ahead of a lackluster 2011 and pulling in the cash fast. This indicates TSMC's second quarter could be at the top end of, or beat, the guidance for 2Q12 sales of NT$126 billion to NT$128 billion.
On a consolidated basis, TSMC's net sales for May 2012 were NT$44.14 billion (about $1.48 billion), an increase of 9 percent over April 2012 and an increase of 20.2 percent over May 2011. Consolidated revenues for January through May 2012 totaled NT$190.14 billion (about $6.35 billion), an increase of 6.1 percent compared to the same period in 2011.
In contrast May sales for UMC (Hsinchu, Taiwan) were NT$9.21 billion (about $308 million), up 0.9 percent on April and down 2.1 percent on May 2011. UMC's sales for the year through to May are NT$42.10 billion (about $1.41 billion), down 10.6 percent in the same period in 2011.
The diverging trends suggest that TSMC's command of about 50 percent of the foundry business, and status as the preferred supplier to leading fabless chip companies is proving lucrative despite some supply problems. UMC has yet to benefit significantly from any dissatisfied customers frustrated by not being able to get enough 28-nm silicon from TSMC, a topic of speculation and commentary in the first four months of the year.
Such is the long lead time and strategic nature of foundry partner moves that for this node fabless chip companies must accept whatever TSMC dictates in terms of supply and price. However, dual-sourcing is likely to be higher on the agenda for future chip designs and production decisions and may come to benefit UMC, but also others such as GlobalFoundries and Samsung.
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