Global semiconductor sales face a decline next year, according
to the world's largest contract chip maker.
Taiwan
Semiconductor Manufacturing Company (TSMC), which has half of
the sector's global market share, is predicting a fall in sales of
up to 9%.
Rick Tsai, CEO at Taiwan Semiconductor Manufacturing Company,
yesterday told an investor conference in Taipei, "We are now
expecting the semiconductor industry [revenues] to decline by
mid-to-high single digits in 2009."
"For the business right now, all customers are adjusting their
inventories and they are very cautious on (submitting) orders."
He was speaking as TSMC reported its latest
quarterly results, showing net profit of $930m in the
July-September period, a shade higher than the previous year - an
increase of 0.6% - and in line with analysts' forecasts.
Lora Ho, TSMC's CFO, said, "With global financial markets going
through unprecedented turmoil and the world economy in a high state
of uncertainty, most of our customers are aggressively paring their
inventories and have thus reduced significantly their wafer
demand."
TSMC predicted lower sales in the final quarter as well as next
year. And it is planning to cut capital spending in 2009 by 20%
from $1.8bn this year.
Earlier in the week, its rival
UMC reported its first quarterly
net loss in seven years, and also predicted a decline in sales.
Chip makers have been hit by the global economic slowdown, which
is leading to fewer orders by manufacturers of PCs and other
consumer gadgets.
Tsai said, however, that the impact would be less severe than
the fall-out from the bursting of the technology bubble in
2001.
He said, "We all feel the rage of the storm. However, it is
different from 2001," adding, "the magnitude is smaller."