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Week In Review: Manufacturing, Test

U.S. chip bill; PCB woes; semi education; earnings.

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Government policy
As reported, the United States is in dire need of more fab capacity as well as packaging plants. The U.S. took a big step in an effort to solve the problem. The U.S. House of Representatives this week introduced the America Competes Act of 2022. The bill includes funding for the Creating Helpful Incentives to Produce Semiconductors for America (CHIPS) Act, which is earmarked to strengthen U.S. semiconductor manufacturing and research. It includes $52 billion to fund semiconductor research, design, and manufacturing in the U.S.

The CHIPS Act has been in the works for some time, but it’s still not enacted, nor a law. But now, there’s a version of the legislation in the House. There is also a version of the bill in the Senate, called USICA, which passed last June. The U.S. Semiconductor Industry Association (SIA) applauded the moves.

So now, the House needs to pass its version, and come to an agreement with the Senate on a compromised version of the bill. Then, the compromised bill must pass, which in turn will be sent to President Biden to be signed into law.

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The United States has lost its historic dominance in a foundational area of electronics technology–printed circuit boards (PCBs). And the lack of any significant U.S. government support for the sector is leaving the nation’s economy and national security dangerously reliant on foreign suppliers, according to a new report from the IPC, a global association of electronics manufacturers.

Since 2000, the U.S. share of global PCB production has fallen from over 30% to just 4%, with China now dominating the sector at around 50%, according to the IPC. “The PCB fabrication sector in the United States is in worse trouble than the semiconductor sector, and it’s time for both industry and government to make some significant changes to address that,” said Joe O’Neil, the principal of OAA Ventures.

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ventureLAB and the Regional Municipality of York have partnered to expand the Hardware Catalyst Initiative, Canada’s only lab and incubator for hardware and semiconductor companies. York has invested $1.5 million over the next five years.

Chipmakers
Intel posted fourth-quarter GAAP revenues of $20.5 billion, exceeding October guidance by $1.3 billion and up 3% year-over-year. “We exceeded top-line quarterly guidance by over $1 billion and delivered the best quarterly and full-year revenue in the company’s history,” said Pat Gelsinger, Intel’s CEO.

Samsung has reported its financial results for the fourth quarter of 2021. Earnings from the memory business decreased from the prior quarter, but the foundry business posted a new record for quarterly revenue. “For this year, Samsung expects supply to remain tight,” according to the company. Samsung plans to ship the world’s first gate-all-around transistors in the first half of 2022.

UMC’s fourth quarter consolidated revenue increased 5.7% from the previous quarter and up 30.5% a year ago. In 2022, UMC’s capital spending budget is $3.0 billion, including the company’s Fab 12A P6 expansion plan. “In the fourth quarter, strong demand continued to drive full loading across our fabs, while overall wafer shipments grew 1.7% quarter-over-quarter to 2.55 million 8-inch equivalents,” said Jason Wang, UMC co-president. “Looking ahead into Q1 2022, we anticipate that demand across all nodes in UMC’s addressable markets will continue to outpace supply.”

Taiwan’s Intellectual Property and Commercial Court has announced its ruling on UMC and other defendants with respect to the case of the violation of the Trade Secrets Act. The case was brought on by Micron. According to the Taipei Times, here was the ruling.

Debt-ridden Tsinghua Unigroup has been in trouble and was headed towards bankruptcy. But the Chinese company has apparently found some new backers–Beijing Jianguang Asset Management and Wise Road Capital, according to a report from Nikkei. Following the move, Tsinghua Unigroup has scrapped some major memory chip projects, according to the report. Tsinghua Unigroup is the parent company of YMTC, a 3D NAND supplier.

Reports have surfaced that Nvidia may scrap plans to acquire Arm from Softbank, according to Bloomberg. The $40 billion deal is stalled in the regulatory process, according to Bloomberg.

Fab tools, materials
For the December 2021 quarter, Lam Research reported sales of $5.227 billion, and net income was $1.195 billion, or $8.44 per diluted share on a U.S. GAAP basis. This compares to revenue of $5.304 billion, and net income of $1.180 billion, or $8.27 per diluted share, for the quarter ended Sept. 26, 2021. “Lam delivered record calendar year 2021 financial performance within a robust wafer fabrication spending environment” said Tim Archer, Lam Research’s president and chief executive.

KLA has reported GAAP net income of $717.4 million, or $4.71 per share, on revenue of $2.35 billion for the quarter. “KLA’s December quarter and calendar 2021 performance exceeded our expectations in a demanding and challenging environment,” said Rick Wallace, president and CEO of KLA.

SmartSens, a CMOS image sensor supplier, has selected PDF Solutions’ Exensio Fabless as the platform to perform data management and analytics for its entire family of products. “Exensio Fabless enables our product engineering organization to achieve new levels of data analytics for all of our product lines. This has resulted in faster time-to-market and yield for our products, and has increased the demand for our products worldwide,” said Shao Zexu, vice president of process & IP strategy at SmartSens.

Bruker has announced the introduction of Connexus in Europe – a cloud-based collaboration platform that connects nuclear magnetic resonance (NMR) scientists in need of analytical services and data evaluation expertise with NMR laboratories.

Air Liquide plans to invest nearly $60 million to build, own and operate a specialty gas plant at a new manufacturing site in Phoenix, Ariz. Operations and supply are expected to start in the second half of 2022.

Test, automation
Teradyne has reported revenue of $885 million for the fourth quarter of 2021. GAAP net income for the fourth quarter was $230.3 million or $1.29 per diluted share. “Both our test and industrial automation businesses delivered another quarter of double-digit revenue growth compared with the year ago period,” said CEO and President Mark Jagiela.

Separately, Mobile Industrial Robots (MiR), a supplier of autonomous mobile robots (AMRs), experienced a 42% increase in sales in 2021 over 2020. December alone was a record month for the company, with close to 300 robots shipped. MiR is a unit of Teradyne.

Education
The U.S. National Science Foundation (NSF) and the Semiconductor Research Corp. (SRC) signed a memorandum of understanding to support research opportunities for undergraduate students in technical areas related to semiconductors. Under a new, five-year agreement, NSF and SRC will jointly support awards through the NSF Research Experiences for Undergraduates (REU) program.

Ohio University has released a resource guide entitled, “Women in Engineering: Scholarships, Statistics & Tips for Advancing.” This guide provides insights and resources on a list of women in engineering scholarships, statistics, challenges and more. Women hold only about 28% of STEM jobs, but scholarships can make engineering programs more accessible.

The Optica Foundation has announced the Optica Women Scholars program. The program provides resources for 20 women annually via a financial support of $10,000. Meanwhile, II‐VI Inc. has pledged $100,000 over the next five years to the new scholarship program launched by the Optica Foundation.

SkyWater has announced the launch of an apprenticeship program at its Bloomington, Minn. facility. The program is designed with a combination of on-the-job training and formal education. It is based on industry and academic-approved curriculum through Hennepin Technical College.

Market research
For the quarter, Apple posted an all-time revenue record of $123.9 billion, up 11% year-over-year. Despite a slight year-over-year decline in shipments, Apple had an impressive holiday quarter, once again jumping above Samsung into the top spot in the smartphone market, according to IDC.

North America-based semiconductor equipment manufacturers posted $3.92 billion in billings worldwide in December 2021, according to SEMI. The billings figure is 0.5% lower than final November 2021 billings of $3.93 billion and 46.1% higher than December 2020 billings of $2.68 billion. “After record-breaking billings of North America-based semiconductor equipment manufacturers in November 2021, December billings remained robust and were the second-highest ever,” said Ajit Manocha, SEMI’s president and CEO.



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