Onshoring, offshoring, amid predictions for rising IC demand; options to sidestep shortages; Q1 earnings.
Onshoring and the supply chain
Efforts to patch up supply chain weaknesses by moving more manufacturing onshore in the United States and Europe are generating a lot of buzz. Morris Chang, TMSC‘s founder, described those moves as “a very expensive exercise in futility,” during an interview with the Brookings Institution and Center for Strategic and International Studies, adding that it is likely to create what he termed non-competitive unit costs.
Chang also downplayed the threat of China repatriating Taiwan. “If there is a war in the Taiwan Strait, then I think the United States will have more than chips to worry about,” he said.
Startup BEV truck manufacturer Rivian might see things differently. The company reportedly complained that semiconductor supply chain snags forced it to raise prices by 20%, much to the chagrin of customers. Rivian later reversed course.
When exactly supply will match demand depends upon the sector and who’s crunching the numbers. Counterpoint Research said chip shortages are likely to continue easing during the second half of 2022.
That’s assuming demand predictions are correct, though. Peter Wennink, president and CEO of ASML, told analysts there are no signs of any weakening in the company’s customer base.
Kyocera is counting on that demand. The company is building its largest manufacturing plant ever in Japan for organic and crystal device packages, based on projections for increased demand for automotive cameras and ADAS chips, as well as 5G infrastructure. The facility is expected to begin operation in October 2023.
Meanwhile, a new McKinsey report examines different options for chipmakers to meet that demand in the short term.
And South Korea’s Ministry of Science and ICT submitted a plan to set up a national semiconductor research institute that includes a new 300mm fab.
Numbers
Lam Research reported Q1 revenue of $4.06 billion and non-GAAP net income of $1.036 billion, in line with previous guidance. Tim Archer, Lam’s president and CEO, said the company’s growth was hampered by a “difficult supply environment,” but expressed optimism about the underlying market dynamics. “We remain confident in the secular drivers of wafer fabrication equipment investment, as well as Lam’s leadership position, and expect to return to solid growth as industry constraints ease.”
ASM International‘s Q1 revenue grew 25% (YoY at constant currencies) to €516.9 million. Benjamin Loh, ASM’s president and CEO, attributed the growth to strong momentum in memory and in the power/analog and foundry segments. He likewise pointed to supply chain constraints.
IBM, meanwhile, reported Q1 revenue of $14.2 billion, an 8% increase, driven by software and consulting and led by hybrid cloud revenue, which grew 14%.
Teradyne shipped its 7,000th J750 test platform, this one to Nations Technology, a Chinese company that makes MCUs and security ICs. The test equipment has been particularly successful in the automotive and consumer markets, where demand has risen significantly in recent years.
Tools
CyberOptics will peel back the covers on its new Dual-Mode Multi-Reflection Supression system at SMTconnect in Nuremberg, Germany, next month. The equipment is aimed at ensuring proper solder paste levels and heights, inhibiting distortion caused by reflection from shiny components and surfaces by capturing and transferring multiple images in parallel.
Awards: The Power Of Six
JCET received a supplier excellence award from Texas Instruments, the sixth time it won the award for IC manufacturing and technical service.
Synopsys was named a leader in Gartner’s “magic quadrant for application security testing” for the sixth straight year.
Newsletters
The latest Manufacturing, Packaging and Materials newsletter can be found here, with these top features:
Semiconductor Engineering’s April Test, Measurement and Analytics Newsletter can be found here.
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