IC substrate suppliers to have mixed 2Q
digitimes.com
Ingrid Lee, Taipei; Rodney Chan, DIGITIMES [Monday 28 May 2007]
Suppliers of flip-chip (FC) substrates will have a mixed second quarter, with Taiwan's leading maker Nan Ya Printed Circuit Board (NPC) likely to see a worse-than-expected decline in revenues because of weak demand from Intel, according to industry and company sources.
Kinsus Interconnect Technology will still see growth in the second quarter, but it has already revised down its revenue goal because of weaker-than-expected demand from the PC and memory card segments, company sources said.
But Phoenix Precision Technology (PPT) will see more than 20% growth because of strong orders for FC substrates for graphics chips and chipsets, the sources indicated.
CPU inventory issues at Intel have sent the chipset maker asking suppliers to lower prices, the sources said. For NPC, shipments of CPU-use substrates were weak in April, and prices in May have gone down 5-6%, the sources added. In addition, with orders at its Japanese strategic partner NGK also decreasing, the leading substrate supplier may now see its second-quarter revenues decline 15-20%, sharper than the 5-10% it originally predicted, the sources said.
Kinsus has seen significant rises in orders from the communications sector in the second quarter. Significant rises in orders have been coming from Qualcomm, Broadcom, Marvell, STMicroelectronics and Texas Instruments (TI), sources at Kinsus said.
But Kinsus, which chiefly offers bismaleimide triazine (BT) based substrates, is seeing orders decreasing from the PC segment, as clients are shifting their demand from BT to ABF (ajinomoto build-up film) substrates, for which Kinsus only has a small volume of output, the sources said.
As for memory-use substrates, tight supply of flash chips is slowing module makers' shipments, which in turn is cutting demand for substrates, the sources said, adding Kinsus' overall revenues for the second quarter will grow only 15%, lower than the 20% it originally expected.
PPT, whose clients are chiefly non-Intel chipset and graphics card makers, have seen orders growing from VIA Technologies, Silicon Integrated Systems (SiS), Nvidia, and AMD, industry sources said.
PPT president Chu-ching Hu has estimated the company's second-quarter growth at 15-18%, but the sources said PPT's revenue growth may top 20% in the second quarter.
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