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Think quarterly, stupid

14 April 2009 | By Mark Osborne | Editor's Blog

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Turning all the doom and gloom forecasting on its head and things don’t look that bad, according to IC Insights. In particular, take a look at recovering sales at the largest foundry, TSMC and it's up from hereon in for the rest of year and possibly beyond.

Looking at life from the depths of a deep black hole is never going to be a good thing, so IC Insights' Bill McClean wants us to tip our heads upwards and look at the tiny speck of light at the top of the hole and imagine that we will get there sooner rather than later.

Indeed, IC Insights is saying by the end of 2009 we will have the US$ trillions of stimulus packages from major nations kicking-in, low interest rates and low oil to thank for a recovery in the making.

In the semiconductor industry we will have rising ASPs, stronger demand and little over supply as CapEx cuts have been huge.

Taking TSMC as an example, McClean noted that it had sales of US$10.6 billion in 2008. But sales are expected to decline by as much as 35% in 2009.

Nothing good about that is there?

However, McClean noted that;

“TSMC also released 1Q09 sales guidance of about US$1.1 billion. Using this guidance as a starting point, the company would need to post quarterly results similar to that shown in [chart below] in order to reach US$6.9 billion. As shown, this would result in a 4Q09/1Q09 revenue increase for TSMC of about 127%!”

You see that isn’t bad after all, is it?

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Reader comments

I think, SEMI's World Fab Forecast from Feb 09 shows same trends for equipment and construction spending.
By Tim D. on 17 April 2009
This basically correct. However the success of TSMC is also a bad omen for the remaining IDMs. A growing number of ICs are being transferred to foundries; the trend will accelerate following this recession. How many high end IC designs are approved for production every year? How many are going to foundries? These are the all important questions that this industry needs to be asking year after year, as we abandon Moore's law growth.
By Adolfo Gutierrez on 15 April 2009

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