Intel’s 14nm woes; Samsung’s new memory; GF’s award; TowerJazz buys fab.
Is Moore’s Law alive or dead? That’s still a topic for debate. In any case, chipmakers continue to move to advanced nodes, but the transitions are taking longer. Even mighty Intel is struggling, based on what the company said about its 14nm finFET process during an investors meeting this week. In fact, Intel continues to struggle with its yields. “14nm yield is maturing; 14nm is still not yielding as well as 22nm, but Intel expects 14nm to match 22nm yields sometime in H2:16. The transition has been more difficult than initially anticipated (somewhat behind vs. where Intel wanted to be,” said Amit Daryanani, an analyst with RBC, in a report. “Importantly, Intel notes that they continue to maintain a significant advantage vs. peers (Samsung and TSMC) when it comes to (the) ability to achieve higher density of transistors. More importantly, Intel remains convinced their lead and density advantage should remain intact (if not perhaps improve) when everyone eventually transitions to 10nm.”
In a report, Weston Twigg, an analyst with Pacific Crest Securities, said: “While Intel remains ahead of competitors, it noted that it is still struggling with 14nm yields. Yield challenges are likely to remain the norm as process complexity increases. This could become a persistent industry problem, but it is not likely to affect equipment companies in 2016 as Intel and foundries prepare to ramp 10nm technology.”
“At its analyst day, Intel announced a $10 billion (+/- $500 million) capex plan for 2016, up from $7.3 billion in 2015. 3D NAND expansion accounts for $1.5 billion of the increase, with the remaining $1.2 billion related to installation of 10nm logic capacity. This is positive for semiconductor equipment stocks, and we are raising our 2016 capex estimate for Intel to $10 billion from $8.2 billion,” Twigg said. “Intel’s plan to spend $1.5 billion on 3D NAND in 2016 is much more than the under $1 billion we had expected. 3D NAND capex in the range of $1.5 billion could generate between 20,000 to 25,000 wafer starts in a greenfield site, and perhaps higher if Intel has a good level of equipment reuse at its Dalian fab.”
Netlist has entered into a five-year joint development and license agreement with Samsung to produce a new class of NVDIMM-P (NV-P) memory solutions, based on Samsung’s NAND flash and DRAM and Netlist’s HyperVault. NV-P is new class of NAND-based storage, which operates in the memory channel. The companies plan to sample NV-P products with select customers in 2016.Under the terms, Netlist will receive $23 million, consisting of $8 million in cash from Samsung and $15 million in the form of investment from Samsung Venture Investment Corp.
China continues to make bold statements about investing in the semiconductor business and fab tool arena. This time, China’s Tsinghua Unigroup says it plans to invest $47 billion over the next five years. With the funds, it hopes to become the world’s third-biggest chipmaker, according to reports.
GlobalFoundries has been presented with an Award of Excellence from Inova Semiconductors GmbH, a specialist in the development of products for Gigabit/s serial data communication for in-vehicle display and driver assistance systems.
TowerJazz continues to buy more fab assets. This time, it has signed an agreement with Maxim Integrated Products to purchase Maxim’s 8-inch fab in San Antonio, Texas.
On Semiconductor will acquire Fairchild for $20.00 per share in an all cash transaction valued at approximately $2.4 billion. Meanwhile, M/A-COM has entered into a definitive agreement to acquire FiBest, a Japan-based merchant market component supplier, in an all-cash transaction valued at approximately $60 million.
North America-based manufacturers of semiconductor equipment posted $1.33 billion in orders worldwide in October 2015 (three-month average basis) and a book-to-bill ratio of 0.98, according to SEMI. This compares to 1.04 in the previous month.
Semiconductor equipment is a tough business. The large companies are getting bigger. Many are buying the smaller players. And some are simply going under. For example, Qcept, a developer of inspection equipment, has recently closed its doors, according to the Atlanta Business Chronicle. Over the years, Qcept raised more than $50 million in venture capital.
Continued demand for affordable smartphones in emerging markets drove worldwide sales of smartphones in the third quarter of 2015, according to Gartner. Global sales of smartphones to end users totaled 353 million units, a 15.5% growth over the same period in 2014.