Taiwan Semiconductor Customers Seek Shipment Delays
By Minoru Matsutani
Hsinchu, Taiwan, Sept. 11 (Bloomberg) -- Taiwan Semiconductor Manufacturing Co., the world's largest supplier of made-to-order chips, said some customers asked for delivery delays as personal- computer sales fall short of expectations.
The delay in shipments for orders already placed may result in a drop in sales from the previous quarter this quarter and next, Kenneth Kin, Taiwan Semiconductor's senior vice president in charge of worldwide marketing and sales, said in an interview.
``We have seen a slowdown in overall demand,'' Kin said. ``Particularly weak is the PC industry.''
Chief Financial Officer Harvey Chang, speaking at a Shanghai technology conference, said Taiwan Semiconductor will cut its production target for chips made with 12-inch wafer technology by 50 percent because of slower demand, a company spokesman said.
Kin's comments are further evidence the semiconductor industry's outlook is deteriorating. Taiwan Semiconductor's customers, a list that includes chipmakers such as Intel Corp., typically begin building inventories as early as August to prepare for the Christmas shopping season.
This week, market researcher IDC lowered its 2002 PC shipment growth forecast to 1.1 percent, or 135.5 million units, from 4.7 percent predicted in June. IDC cut its growth estimate for next year to 8.4 percent, or 147 million units, from its earlier forecast of an 11 percent gain.
``The fourth quarter is going to be pretty tough for everybody,'' said Ernie Tam, who counts shares in Taiwan Semiconductor among the $2 billion he helps manage for Baring Asset Management Ltd. ``The personal computer sector appears to be weak.''
IDC's revisions reinforced findings from Intel, which supplies about four fifths of all processors used in personal computers. Intel Chief Executive Officer Craig Barrett said last month PC demand may not rebound during Christmas season.
At Taiwan Semiconductor, sales in the third and fourth quarters will ``be flat or slightly decline'' from the previous quarters, though they will grow in the second half compared with the same period last year, Kin said. He declined to specify which customers are delaying shipments.
The company has lowered its monthly target for production of 12-inche silicon wafers to 5,000 from 10,000 for the remainder of the year, spokesman J.H. Tzeng said, confirming a report in the Commercial Times that cited the chief financial officer. He was speaking at a conference organized by Goldman Sachs Group Inc. in Shanghai.
The company is one of about five chipmakers in the world producing advanced 12-inch wafers, which yield more than double the number of chips and pare production costs by up to a third.
Global sales of semiconductors fell by a third in 2001 to $139 billion, their worst-ever annual decline, the Semiconductor Industry Association said in February.
Taiwan Semiconductor posted sales of NT$35.8 billion ($1 billion) sales in the first quarter and second quarter sales of NT$44.2 billion. |
