Archive for the ‘Mergers & Acquisitions’ Category
Thursday, March 26th, 2020
Hardest hit are ≤200mm wafer fabs, 70% of closures in Japan and North America.
Over the past decade, the IC industry has been paring down its older capacity as manufacturers have consolidated or transitioned to the fab-lite or fabless business models. In its recently released Global Wafer Capacity 2020-2024 report, IC Insights shows that due to the surge of merger and acquisition activity in the middle of this decade and with more companies producing IC devices using sub-20nm process technology, suppliers have eliminated inefficient wafer fabs. Since 2009, semiconductor manufacturers around the world have closed or repurposed 100 wafer fabs, according to findings in the new report.
Figure 1 shows the number of fabs closed by geographic region while Figure 2 shows a distribution of those fabs by wafer size and year.
 Figure 1 (more…)
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Friday, March 20th, 2020
Propelled by 51% share of IDM sales and 65% share of fabless sales, U.S. companies captured 55% of the total worldwide IC market in 2019.
Regional marketshares of IDMs (companies operating wafer fabs), fabless companies, and total IC sales were led by U.S. headquartered companies in 2019, according to data presented in the recently released March Update to The McClean Report 2020.
Figure 1 shows U.S. companies held 55% of the total worldwide IC market in 2019 followed by the South Korean companies with a 21% share, down six percentage points from 2018. Taiwanese companies, on the strength of their fabless company IC sales, held 6% of total IC sales, one point less than the European companies.
Figure 1
South Korean and Japanese companies have an extremely weak presence in the fabless IC segment and the Taiwanese and Chinese companies have a noticeably low share of the IDM portion of the IC market. Overall, U.S.-headquartered companies showed the most balance with regard to IDM, fabless, and total IC industry marketshare.
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Tuesday, March 10th, 2020
“Black Swan” is a commonly used phrase in the world of finance to describe an event that is unexpected and unknowable. The recent surge of the spread of the coronavirus (Covid-19) and its anticipated negative impact on the global economy and IC market definitely fits the definition of a Black Swan event. Such events typically cause a great deal of uncertainty and that is certainly the case today.
Over a decade ago, Jeff Immelt, then-CEO of General Electric, coined the term “reset economy.” He used this phrase to describe what he expected to be a very different world following the financial meltdown and ensuing global economic crisis of 2008-2009.
Fast forward to 2020. IC Insights believes that this “reset” philosophy can be applied to the global IC industry this year following the current worldwide disruption to trade and business and the expected subsequent slowdown of the global economy due to the Covid-19 outbreak.
After enduring a steep market decline in 2019, most believed the IC industry was poised for a reasonably robust recovery in 2020. In fact, January 2020 global IC sales were up a solid 79% from one year earlier in January 2019. IC Insights had originally forecast an 8% increase for the 2020 IC market in its McClean Report 2020 that was released this past January.
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Thursday, March 5th, 2020
Though growth rates in some product categories have slowed, doubling of transistors per chip every two years remains a guideline that the industry continues to follow.
The primary yardstick by which the IC industry measures its technological performance and progress remains Moore’s Law that states there is a doubling of the number of transistors per chip every two years. It pertains to the growth rate of components per chip, but it is sometimes generalized to describe the exponential growth in raw computational power achieved with each new generation of ICs.
IC Insights’ 2020 edition of The McClean Report (released in January) shows how over the past five decades, DRAMs, flash memories, microprocessors, and graphics processors have tracked the curve Moore predicted (Figure 1).
Figure 1
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Thursday, February 27th, 2020
Though rising 7%, total semiconductor units forecast to fall short of all-time record.
Annual semiconductor unit shipments, including integrated circuits and optoelectronics, sensors, and discrete (O-S-D) devices are forecast to rise 7% in 2020 and surpass one trillion units for the second time in history, based on data presented in the new, 2020 edition of IC Insights’ McClean Report—A Complete Analysis and Forecast of the Integrated Circuit Industry, released in January 2020.
The 7% increase to 1,036.3 billion total semiconductor shipments expected in 2020 follows an 8% decline in 2019 and 7% growth in 2018, the year that semiconductor shipments reached 1,046.0 billion units—a record high that is expected to remain in place through at least this year (Figure 1). Starting with 32.6 billion units in 1978 and ending in 2020, the compound annual growth rate (CAGR) for semiconductor units is forecast to be 8.6%, an impressive annual growth rate over 42 years, given the cyclical and often volatile nature of the semiconductor industry.
 Figure 1 (more…)
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Friday, February 21st, 2020
Despite high development costs, using smaller nodes yields larger revenue per wafer.
The success and proliferation of integrated circuits has largely hinged on the ability of IC manufacturers to continue offering more performance and functionality for the money. Driving down the cost of ICs (on a per-function or per-performance basis) is inescapably tied to a growing arsenal of technologies and wafer-fab manufacturing disciplines as mainstream CMOS processes reach their theoretical, practical, and economic limits.
Based on data presented in IC Insights’ new edition of The McClean Report (released in January 2020), many IC companies are now designing high-performance microprocessors, application processors, and other advanced logic devices based on 10nm and 7nm process technology. Some of the current iterations from logic and foundry suppliers are shown in Figure 1.
 Figure 1
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Monday, February 10th, 2020
Seven major semiconductor acquisition agreements valued at $1 billion or more increase the total value of all deals by 22% from the previous year, continuing the strong wave of M&A and consolidation among chip suppliers.
Semiconductor merger and acquisition activity strengthened in 2019 after pulling back in the two previous years from historic high levels of M&A agreements in 2015 and 2016. More than 30 semiconductor acquisition agreements in 2019 had a combined value of $31.7 billion, which was a 22% increase from $25.9 billion in 2018, according to data compiled by IC Insights in its new 2020 edition of The McClean Report—A Complete Analysis and Forecast of the Integrated Circuit Industry. The 2019 value of semiconductor acquisition agreements reached the third-highest annual total ever, but the year was still far behind 2015 and 2016 (Figure 1).
 Figure 1 (more…)
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Friday, January 31st, 2020
Technical challenges including the move to EUV lithography, sub-3nm process technology, 3D die-stacking technologies, and advanced packaging are expected to lift R&D growth rates.
The semiconductor business is defined by rapid technological changes and the need to maintain high levels of investment in research and development for new materials, innovative manufacturing processes for increasingly complex chip designs, and advanced IC packaging technologies.
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Wednesday, January 22nd, 2020
Number of IC categories with expected sales growth in 2020 represents a big reversal from only six growth segments in 2019.
IC Insights recently released the 2020 edition of The McClean Report. The new analysis and forecast of the IC industry includes IC Insights’ 2020 ranking of sales growth rates for each of the 33 IC product categories defined by the World Semiconductor Trade Statistics (WSTS) organization. The top-10 fastest growing IC segments for 2020 are shown in Figure 1.
After posting the two worst growth rates among all IC product categories in 2019, NAND flash and DRAM are forecast to be among the top three fastest-growing IC segments in 2020. It is worth noting that DRAM and NAND flash were the two largest IC markets in terms of sales volume in 2019 and are forecast to repeat as the two largest IC sales categories again in 2020.
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Thursday, January 9th, 2020
Rise of China-based fabless IC suppliers offers increased opportunities for foundries.
IC Insights is in the process of completing its forecast and analysis of the IC industry and will present its new findings in The McClean Report 2020, which will be published later this month. Among the semiconductor industry data included in the new 400+ page report is an in-depth analysis of the IC foundry market and its suppliers.
With the rise of the fabless IC companies in China (e.g., HiSilicon) over the past 10 years, the demand for foundry services has also risen in that country. Figure 1 shows that the China market was the only major region that showed an increase in pure-play foundry sales last year. Moreover, the European and Japanese pure-play foundry markets each displayed a double-digit decline in 2019.
Figure 1
China’s total share of the 2018 pure-play foundry market jumped by five percentage points as compared to 2017 to 19%, exceeding the share held by the rest of the Asia-Pacific region by five points. Overall, China was responsible for essentially all of the total pure-play foundry market increase in 2018. However, in 2019, the U.S./China trade war served to slow economic growth in China and the country’s foundry marketshare increased only one percentage point last year to 20%.
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