Semiconductor manufacturers expect varying levels of growth — from 3 percent to 34 percent — for the third quarter (Q3), reported IC Insights, but the overall picture is rosy for the chip market.
Supply remains a concern for most segments of the manufacturing industry, but chip demand remains high. In advance of an expected surge in demand for 5G smartphones during the upcoming holiday season, Qualcomm and Apple anticipate significant increases in their 3Q21 semiconductor sales. Also, the big three memory IC suppliers—Samsung, SK Hynix, and Micron—are each expected to post a 10 percent increase and Kioxia is anticipated to show an 11 percent jump in 3Q21 sales as demand remains strong for memory in data center servers, enterprise computing, and for 5G smartphones and related infrastructure.
In 2Q21, TSMC was the third-largest chip company in terms of sales and the largest semiconductor foundry in the world. It is the go-to manufacturer for ICs based on leading-edge 7/5nm process technologies, which are in high demand and collectively accounted for about half of TSMC’s second-quarter revenue. The company reported that 18 percent of its 2Q21 revenue was from ICs made using its 5nm process technology while 7nm device technology accounted for 31 percent of its 2Q21 sales.
TSMC expects its 3Q21 sales to climb 11 percent. IC Insights forecasts its sales will rise another 4 percent in 4Q21. IC Insights believes TSMC’s second-half sales will be 14 percent greater than its first-half sales, yielding a full-year increase of 24 percent. If achieved, it would mark back-to-back years of more than 20 percent revenue growth for the foundry giant. TSMC’s annual sales increased a whopping 31 percent in 2020.
AMD was ranked as the 11th largest chip company in 2Q21 and anticipates its sales will rise 6 percent in 3Q21. For the year, AMD expects to register an enormous 60 percent surge in sales. AMD’s sales have been rising quickly since 2Q20. The company is forecast to post sales of $4.10 billion and $4.23 billion in the third and fourth quarters respectively this year, resulting in second half sales that are 14 percent more than in 1H21. AMD uses TSMC to fabricate its new, Zen 3 processors using 7nm technology.
A few leading companies—notably Intel and Texas Instruments—do not expect to see such rosy 3Q21 sales gains. TI is guiding for flat 3Q21 sales results. Intel, now the second-largest semiconductor supplier in the world, put its 3Q21 sales guidance at -3 percent, and its full-year sales guidance at -1 percent during its most recent earnings presentation. In a year when total semiconductor sales are forecast to grow 24 percent, this would be an especially weak showing for the processor giant. Moreover, Intel’s 2H21/1H21 sales expectations are also for a 1 percent decline. Intel’s 4Q21 sales are currently forecast to be 3 percent less than its 1Q20 sales, resulting in a two-year period of essentially flat results.
Collectively, the top 15 companies are forecast to experience 7 percent growth in 3Q21. Semiconductor sales are forecast to remain robust through the end of the year, which supports IC Insights’ current forecast of 24 percent growth for worldwide semiconductor sales this year.
For more information please contact Bill McClean, president at IC Insights. Phone: +1-480-348-1133 email: email@example.com