Feeds

TSMC up, UMC down in Q2

But both foundries a long way from last year's highs

  • alert
  • submit to reddit

Business security measures using SSL

TSMC, the world's biggest chip foundry, strengthened its financial position during its second quarter over the previous three-month period, though it still has some way to go to achieve the highs of Q2 FY2004.

Its arch-rival, UMC, the world's second biggest foundry, proved less successful, with sales and profits down sequentially and year on year.

Both firms' sliding revenues were anticipated earlier this month after they published their June sales tallies.

TSMC reported revenues of TWD58.52bn ($1.83bn), up 5.1 per cent on the previous quarter but down 9.8 per cent on the year-ago period. Net income came to TWD18.37bn ($575m), up 9.2 per cent sequentially but down 21.5 per cent year on year. The company reported earnings of TWD0.74 per share.

Wafer shipments rose 14.5 per cent sequentially during the quarter, hindered by a 4.5 per cent fall in average selling prices, TSMC said. Revenue from 90-130nm process lines fell from 45 per cent of the total in Q1 to 43 per cent in Q2. Gross margins rose by less than a percentage point to 39.7 per cent as more capacity was given over to production.

TSMC attributed the sequential gains to "demand recovery from our customers" and noted that it expects this trend to continue through Q3. It said it expects wafer shipments to rise approximately 15 per cent during the current quarter as capacity utilisation rises to beyond 90 per cent. That will push gross margins up 1.3-3.3 percentage points to 41-43 per cent, it forecast. ASP will fall again, "by a low to mid single digit percentage point".

UMC's Q2 FY2005 sales totalled TWD19.44bn ($609m), down 4.2 per cent sequentially and 33.4 per cent year on year. Net income plunged 93.1 per cent sequentially and 97.9 per cent year on year to TWD212m ($6.7m) as the company slipped into red operationally. Earnings fell to a mere TWD0.02 per share.

Still, UMC reckons the worst is over: "We are quite confident we have exited the trough of the downturn," said company CEO Jackson Hu.

Wafer shipments were up 11.7 per cent sequentially, UMC said. Capacity utilisation topped 65 per cent, higher than the 60 per cent utilisation rate UMC had previously predicted. The share of revenues arising from its 90nm process rose from seven to nine per cent. However, ASP fell nine per cent over Q1 FY2005 as demand shifted toward older, larger processes, as it did at TSMC.

Like TSMC, UMC expects wafer shipments to rise by around 15 per cent during Q3, though it also expects ASP to rise slightly. At an operational level, it expects to break even or report a slight loss. ®

Related stories

TI reaps wireless boom
Elpida falls into red on weak DRAM prices
Freescale grows Q2 earnings on flat sales
Intel overcomes 'weak' line-up during Q2
Rambus reports record revenue
AMD shrugs off Intel shackles for ace Q2
Chip kit market shrinks
TSMC, UMC Q2 sales slide
UMC chairman to quit over China investment case

Reducing the cost and complexity of web vulnerability management

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
JINGS! Microsoft Bing called Scots indyref RIGHT!
Redmond sporran metrics get one in the ten ring
Driving with an Apple Watch could land you with a £100 FINE
Bad news for tech-addicted fanbois behind the wheel
Murdoch to Europe: Inflict MORE PAIN on Google, please
'Platform for piracy' must be punished, or it'll kill us in FIVE YEARS
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
Sony says year's losses will be FOUR TIMES DEEPER than thought
Losses of more than $2 BILLION loom over troubled Japanese corp
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
Protecting users from Firesheep and other Sidejacking attacks with SSL
Discussing the vulnerabilities inherent in Wi-Fi networks, and how using TLS/SSL for your entire site will assure security.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.