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TSMC ponders 20 percent cut in capex for 2009
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TSMC has not reduced planned capital spending for 2008, which is expected to be $1.8 billion, after rival UMC said that it would be reducing spending to between $400 and $500 million for 2008, after experiencing a significant slowdown in customer demand and falling utilization rates.
However, TSMC executives said in a conference call that its 2009 CapEx plans were under evaluation and that analysts could expect the foundry to reduce spending in the range of 20 percent from 2008.
Capital expenditures at TSMC $332 million during the third quarter, with total spending having reached $1.5 billion.
TSMC noted that demand was falling but that the previous quarter showed an increase in business, including the continued migration to its leading-edge manufacturing processes. According to TSMC, revenue from 65nm reached 25 percent of total wafer sales during the quarter, up from 18 percent in the previous quarter. Revenue from 90nm declined slightly to 26 percent of total wafer sales. Overall, revenues from advanced technologies (130nm and below) accounted for 66 percent of total wafer sales, up from 63 percent in 2Q08.
With capital expenditure plans unchanged for 2008, TSMC has been able to further ramp production capacity. TSMC managed capacity reached 2,416K 200mm equivalent wafers in the third quarter, 5 percent more than 2Q08. TSMC expects managed capacity to increase a further 3 percent in 4Q08 to 2,478K 200mm equivalent wafers.
For the year, TSMC expects managed capacity to have grown by 13 percent, compared to 2007. The biggest capacity increases coming from 300mm fabs, which will have increased by 27 percent in 2008, compared to 2007.
