Foundry market can still grow in 2020, despite Covid-19
The median figure is 6.8 percent. This is slightly higher than TSMC, which trimmed its forecast for the overall foundry market to low single-digit percentage growth, although the foundry market leader thinks it can outperform the foundry market.
TrendForce said that foundry clients have refrained from large cutbacks in orders in the 1H20 wanting to make sure they were well-stocked to take advantage of any snap-back in demand when the pandemic situation improves.
However, TrendForce expects foundry orders in the 2Q20 to be down on 1Q20, usually a time of year when orders are starting to build. This is particularly true in the seasonal consumer electronics sector. At the same time orders for chips used in telework and medical applications, critical during the pandemic, may be adjusted upwards. It should also be remembered that 2Q19 was a particular low comparison point giving even a sequentially falling 2Q20 a good chance of year-on-year growth, TrendForce said.
Total foundry revenues 2016 to 2020 (US$ millions). Source: TrendForce.
The prospect that the pandemic’s general and economic impact will continue into the 2H20 is likely to lower the foundry sector’s strong seasonality impacting 2H20 foundry revenues, TrendForce said.
Foundries are trying to pivot away from consumer electronics and towards such applications as 5G infrastructure, data centers, and IoT for industrial automation. Nonetheless the 2H20 is likely to favour second-tier foundries offering specialized and behind the leading-edge manufacturing processes rather than market leaders such as TSMC and Samsung.
TrendForce pointed out there is a high degree of uncertainty and that the baseline assumption that the pandemic will be contained and brought under control in 2H20 may have to be adjusted.
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