Semiconductor market news(Apr. 01 to Apr. 07)丨Taiwan’s Wafer Foundry and DRAM Production Unaffected; Samsung, SK Hynix increase 24H2 DRAM production capacity; Foxconn expands production of AI servers…

01. Samsung, SK Hynix increase 24H2 DRAM production capacity

According to the Omdia report, major Korean memory chip manufacturers, including Samsung Electronics and SK Hynix, are expected to return to pre-production reduction levels in DRAM memory wafer production in the second half of 2024, ending nearly a year of production reductions.

02. Global Semiconductor Sales Increase 16.3% Year-to-Year in February

The Semiconductor Industry Association (SIA) today announced global semiconductor industry sales totaled $46.2 billion during the month of February 2024, an increase of 16.3% compared to the February 2023 total of $39.7 billion but a decrease of 3.1% from the January 2024 total of $47.6 billion. Monthly sales are compiled by the World Semiconductor Trade Statistics (WSTS) organization and represent a three-month moving average. SIA represents 99% of the U.S. semiconductor industry by revenue and nearly two-thirds of non-U.S. chip firms.

Regionally, year-to-year sales were up in China (28.8%), the Americas (22.0%), and Asia Pacific/All other (15.4%), but down in Europe (-3.4%) and Japan (-8.5%). Month-to-month sales were down across all markets: Asia Pacific/All Other (-1.3%), Europe (-2.3%), Japan (-2.5%), the Americas (-3.9%), and China (-4.3%).

03. Taiwan's Wafer Foundry and DRAM Production Unaffected

TrendForce has provided an update on the dynamics of Taiwan's semiconductor factories following the earthquake on April 3rd.

In terms of DRAM production, the operations at Nanya's Fab3A facility in New Taipei are impacted. The impact on production and supply chain operations at Micron's Linkou plant in Taiwan is still being assessed. Nanya's impacted plant mainly focuses on 20/30nm processes, with its latest 1Bnm process in development. Micron's Linkou and Taichung plants, internally merged into one system, serve as critical sites for DRAM production, already deploying the latest 1beta nm process technology. Both are expected to fully recover within a few days, with subsequent productions, including HBM, continuing in Taiwan. Other facilities resumed operations progressively after inspections. PSMC and Winbond reported no damages.

Regarding wafer foundry operations, TSMC's six-inch and eight-inch facilities, including Fab 2, Fab 3, Fab 5, Fab 8, its R&D headquarters Fab 12, and the newest Fab 20 in Baoshan, Hsinchu, were all located in a Level 4 intensity zone. Only Fab 12 suffered some water damage to equipment due to broken pipes, mainly affecting the not-yet-mass-produced 2nm process. This is expected to have a short-term impact on operations, potentially necessitating the acquisition of new equipment, thus slightly increasing capital expenditures. Other facilities resumed operations after inspections with no significant damage reported, and operations at other sites have progressively returned to normal following evacuation or inspection.

04. TSMC’s Latest Statement Indicates Equipment Largely Recovered, Revenue Forecast Unchanged

According to TechNews, TSMC announced its latest updates on the evening of the 5th, stating that equipment within its Taiwan wafer fabs has largely recovered. The company’s full-year performance outlook, denominated in USD, is expected to remain consistent with the forecast provided during the January earnings call. Annual revenue is projected to grow in the low-to-mid twenties percentage range.

As of the 5th, except for certain production lines in areas with greater seismic impact requiring longer adjustment and calibration times to restore automated production, thanks to the concerted efforts of TSMC colleagues and supplier partners, equipment within Taiwan’s wafer fabs has largely recovered.

05. Taiwanese AI Server Production Lines Shifting from China to Mexico

As American tech giants depart from China and relocate their production of artificial intelligence (AI) server to Mexico, according to a report from UDN, some major AI players have urged their Taiwanese manufacturing partners to enhance their investments in production in Mexico.

In February, Foxconn, the world’s largest electronics manufacturing services provider, announced a USD 27 million investment in purchasing land in the western state of Jalisco, Mexico. According to the report citing sources, this move is aimed at significantly expanding the company’s production of AI servers. Foxconn stated that it has invested approximately USD 690 million in Mexico over the past four years.

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