Analyst: Taiwan foundries on allocation
Mark LaPedus
(12/01/2009 11:33 AM EST)
URL: eetimes.com
SAN JOSE, Calif. -- Contrary to one report, the foundry business is hot, as Taiwan vendors are sold out and leading-edge yields are improving, according to an analyst.
There are other positive signs leading into 2010, including extended lead times for select chips. Lead times for some devices are pushing 20 weeks.
On top of that, PC demand is strong. Inventories remain lean. And consumer products like LCD TVs are seeing new and low price points, which could boost demand.
The foundry business is also strong. ''We believe 12-inch foundry capacity (all nodes) is on allocation through the summer of 2010 and perhaps beyond,'' said Hans Mosesmann, an analyst with Raymond James Equity Research, in a report that concerns his early observations from his Taiwan technology tour.
''Industry sources indicate that TSMC has made a yield breakthrough of 15-20 percentage points in 40-nm yields, an incremental positive for Nvidia. We do believe 40-nm will continue to be tight for months ahead and that Nvidia will likely garner incremental wafer availability,'' he said.
As reported, silicon foundry giant Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) is still having yield issues with its 40-nm process, according to analysts. But TSMC claims that its 40-nm yields will improve by early 2010.
Mosesmann's view is also slightly different than one from iSuppli Corp., which reported that the foundry business is slowing in the fourth quarter.
In any case, demand remains robust. ''Datapoints throughout the tech supply chain (foundry, substrate, chipset, distributor, notebook ODM, etc.) indicate a bit stronger than seasonal 4Q and likely better than seasonal 1Q,'' Mosesmann said.
''Inventories are lean in the supply chain; however, at OEMs there may be increased inventories of some components as these players wait for longer lead time products to be delivered,'' he said. ''The issue in our view is that bear case for semis is getting pushed out from 1Q to 2Q as lead times for some components are above 20 weeks.''
There are mixed signals in the computer space. ''Notebooks, mainstream, and netbook categories are doing better than expected while Intel's CULV thin and light appears to not to be meeting expectations due to price performance,'' he said.
There are some troubling signs, however. CMOS image sensor vendor OmniVision Inc. this week reported October quarter sales of $183 million, above Raymond James' $165 million estimate. GAAP EPS of $0.16 beat the guided $(0.00) to $0.10 range and the firm's $0.02 estimate.
''Outlook for January quarter sales is $145-160 million (down 16.8 percent quarter-over-quarter at the midpoint), well below our $180 million estimate, a shortfall which the company rationalized as being driven (not too convincingly) by stronger-than-seasonal Christmas seasonality in the October quarter,'' Mosesmann said.
''Our concern is that the company's CMOS sensor mix is improving only mildly (VGA still 70 percent of sales) at a time when smartphones are growing and OmniVision is in perhaps sole source position,'' he said.
On the consumer end, U.S. retailers during the week of Black Friday cut prices on LCD-TV models by an average of 22 percent compared to before the event. This caused sales to rise by 6 percent compared to a year earlier, according to a preliminary estimate from iSuppli.
''Defying some pundits' expectations, U.S. retailers this year were able to offer their customary Black Friday promotional deals for LCD-TVs, which represent a critical factor in driving annual sales growth," said Tina Tseng, analyst for iSuppli, in a report.
iSuppli predicts LCD-TV shipments in the United States and Canada will rise by 15.3 percent in the fourth quarter of 2009 compared to the same period in 2008.
Average U.S. Black Friday promotional pricing for 32-inch LCD-TVs declined to $369, down 24.7 percent from $490 before the event. The biggest average price reduction was for 19-inch LCD-TVs, at 36.8 percent, followed by 26-inch sets at 34.9 percent, according to the firm.
Average U.S. Black Friday promotional pricing for 40-inch LCD-TVs declined to $577, down 23.3 percent from $752 before the event, according to the firm.
Pricing reductions for larger LCD-TVs were more modest, with 42-inch sets experiencing a 7.3 percent decline and 46-inch sets dipping by 7.2 percent.
"In the 40-inch and larger screen sizes, better-featured models were offered for Black Friday deals," Tseng said. "The majority of Black Friday promotions were for Full-HD, i.e., 1080p-resolution (progressive-scan) models. Models with 120-Hz refresh rates also were found in the 42-, 46- and 55-inch screen sizes." |
