The Week In Review: Manufacturing

Taiwan blackout; Xcerra deal blocked?; inspection; hype cycle.


Taiwan on Tuesday suffered a blackout after an accident occurred at a gas-fired plant, according to a report from Bloomberg. The outage, which lasted from 5 p.m. to 10 p.m., impacted more than 6 million homes and disrupted some IC production on the island, according to the report. Taiwan’s president was criticized for the event, as the government plans to shutter the island’s nuclear plants and cut the use of coal.

Fab equipment
Test handler supplier Cohu is attempting to block the sale of U.S.-based ATE vendor Xcerra to a fund in China, according to the Wall Street Journal. In April, Sino IC Capital and an affiliate,Unic Capital Management, entered into a definitive agreement under which it would acquire Xcerra for $10.25 per share in cash. The deal is worth approximately $580 million. The transaction is subject to a number of conditions. It must obtain antitrust and other regulatory approvals, including from the Committee on Foreign Investment in the United States (CFIUS).

Applied Materials, which celebrates its fiftieth corporate anniversary on November 10, reported record results in its third quarter ended July 30. Compared to the same period last year, the company grew net sales by 33% to $3.74 billion. “AMAT delivered a good F3Q beat and guided F4Q well above our and the consensus estimates. Demand appears strong in all segments, with semiconductor strength led by NAND and foundry, display strength driven by the OLED ramp and the Gen 10.5 glass build-out, and services growing on a larger installed base and increased service contracts,” said Weston Twigg, an analyst with KeyBanc Capital Markets.

KLA-Tencor has entered into the dedicated reticle blank inspection market. The company has rolled out the new FlashScan reticle blank inspection product line. Using 355nm laser illumination optics, the system can inspect reticle blanks designed for optical or extreme ultraviolet (EUV) lithography.

Photronics, a supplier of photomasks, recently formed a joint mask venture in China. Now, the company has signed another deal in China, this time an investment agreement with the Hefei State High-tech Industry Development Zone, a national-level high-tech zone in China. Under the terms, Photronics will build and operate a facility to engage in the R&D, manufacture and sale of flat-panel display photomasks in China.

Market research
The emerging technologies on the Gartner’sHype Cycle for Emerging Technologies” revealed that three megatrends will enable businesses to survive and thrive in the digital economy over the next few years. Artificial intelligence (AI) everywhere, transparently immersive experiences and digital platforms are the big trends, according to Gartner.

IC Insights has revised its outlook for 33 main product categories classified by the World Semiconductor Trade Statistics (WSTS) organization. DRAM is the fastest-growing IC product segment this year. Following the DRAM market, the industrial/other special purpose logic segment is projected to grow 32%, according to the firm. So what else is hot and what is cold?

Global DRAM revenue reached a new historical high in the second quarter of 2017, reports DRAMeXchange, a division of TrendForce. “Compared with the first quarter, the undersupply situation was not as severe, and OEM clients in the downstream were able to gradually extend their inventories,” according to the firm.

TrendForce reports that the global notebook shipments for the second quarter registered a sequential quarterly increase of 5.7% and a year-on-year increase of 3.6%, totaling 39.96 million units.


Sean says:

I like to read semiengineering articles and really learn a lot about this huge industry that is semiconcductor.

But you also need to be more diligent on what you write: “U.S.-based ATE vendor Xcerra” . NO!. Xcerra is not ONLY an ATE vendor. If it was the case Cohu would not give a damn about this aquisition. Xcerra is also a Handler, Contactors and turnkey TestCell solution vendor. This is exactly what bothers Cohu. Cohu already has 50% market share of the handler business (while Xcerra has less than 10%) and has aggressive plans to grow in China both its handler and contactor business.
Cohu sees the aquisition of Xcerra as a threat to its growth plan but disguises it as a threat to the American industry.
What is even more ridiculous, is the claim by Cohu that critical customer information would fall into Chinese hands.
First, the Qualcomms&Co are big enough to say what they think about this and do not need Cohu to speak for themselves.
Second, this is a vain attempt to scare the Qualcomms&Co in a time where some product benchmarks are taking place at these customers.
Third, Cohu closed down its manufacturing in the US about 5 years ago. From one day to another all people were laid off and production transfered to Malaysia, where most top and middle management are of Chinese origin. Not to mention Cohu’s operations in China as well. These people and the same “critical information” could easily be poached by Chinese companies.
Fourth, welcome to globalization!
Fifth, Goliath scared of David?!? Come on guys you can do better than that.
Last point, it is interesting how you never write about the Handler and Contactors part of the semicon industry. We always read about the wafer foundry side, the OSAT side, design tools, etc…
I can tell you that there are more exciting things going on in Handlers and Contactors than what you would think.

Mark LaPedus says:

Hi Sean. Thanks for pointing out those details. (Sorry for not getting into the details here.)

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