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Chartered Semiconductor raises capex & capacity for Fab 7 |
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Jan 26, 2007 at 12:03 PM |
 Chartered Semiconductor has raised capital spending projections for 2007 in an effort to further ramp its 300mm facility, Fab 7, to accommodate customers planning ramps at the 65nm node this year. Chartered will spend approximately $800 million on equipment this year, compared to $554 million in 2006.
"As we enter 2007, we are excited about starting our 65nm volume production and realizing revenues from our new customers," stated Chia Song Hwee, president & CEO of Chartered. "We are also accelerating the development and qualification of 45nm technology nodes together with our technology development partners to ensure that we stay at the cutting edge of technology, as we further strengthen our business and customer base. In order to further align our manufacturing capabilities with our technology position, we are now adding an additional phase for Fab 7 expansion, focused on 65nm and 45nm technologies, to bring its total capacity to 45,000 12-inch wafers per month. We will also continue our efforts to attain sustainable profitability by lowering our breakeven utilization rate."
Wafer starts at Fab 7 have slowly but steadily increased since 2Q06 to reach 13,777 300mm wafer starts per month, as compared with 10,607wspm in 2Q06. Chartered is now projecting that the $800 million to be spent primarily on Fab 7 will raise capacity to 25,000wspm by the end of 2007. Chartered's Chia is now stating total capacity to be at 45,000wspm, though he gave no indication as to when that target would be reached.
Three customers in 2006 - Broadcom, IBM and AMD - exceeded 10 percent of revenues (excluding Chartered's share of SMP revenues) in 2006. Chartered's top five customers accounted for 60 percent of total revenues in 2006, compared with 56 percent in the previous year.
Though wafer starts for the Xbox 360 were cut back slightly late last year, indicating that wafer starts at Fab 7 may actually fall, as experienced in 1Q06, Fab 7 is now projected to increase wafer-starts to 14,992 per month for 1Q07, which would be the largest quarterly ramp of Fab 7 since initial production started in 2005.
During AMD's most recent financial conference call, executives had noted that its customers were requesting more supply availability of its range of microprocessors and that AMD was expanding capacity internally as well as with its foundry partner, Chartered. The projected rise in capacity for this quarter and a target of 25,000wspm by year end indicates key customer loadings expected this year at Fab 7.
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