I think this may be why......
TSMC boosts profit, warns of slowdown
By Mike Clendenin
Semiconductor Business News
(07/25/02 08:38 a.m. EST)
TAIPEI - Taiwan Semiconductor Manufacturing Company said profit increased 41% sequentially in the second quarter, to $279 million, as utilization hit 85% and communications customers and integrated device manufacturers buoyed demand. But it also warned that a nascent recovery in chips is starting to sputter.
The company said third quarter growth would shrink as average chip prices contract by 5% from the second quarter. Analysts believe growth will slow substantially to the high single digits. The same is expected to happen at United Microelectronics Corp., which reports earnings next week.
Last week, Singapore-based foundry Chartered Semiconductor Manufacturing said its revenues would only grow by 5% in the third quarter, much slower than its double-digit first-half growth. Chartered cited a probable slowdown in PC-related chips as those customers become more conservative about seasonal demand. TSMC said sales rose 23% quarter on quarter, to $1.3 billion. That represented its fourth consecutive quarter of growth since hitting its bottom in the second quarter of 2001.
But sales are expected to shrink this month compared to last year, and company CEO Morris Chang said the semiconductor industry is likely to see single digit growth this year. Many semiconductor companies, such as Intel Corp. and Advanced Micro Devices, are forecasting lackluster sales for the current quarter and a slower than expected recovery.
A week ago, Gartner Dataquest took a more conservative view on PC growth in 2002, saying shipments would rise between 2-4%. Its previous estimate called for 5% growth.
Wafer shipments at TSMC for the second quarter of 2002 totaled 719,000 eight-inch equivalent wafers, representing a 20 percent increase over the first quarter of 2002, when utilization averaged 67%, the company said in a statement. |
