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What’s happening with global semicon industry?

August 13, 2011 1 comment

1H11/1H10 top 20 semiconductor sales leaders. Source: IC Insight, USA.

1H11/1H10 top 20 semiconductor sales leaders. Source: IC Insights, USA.

IC Insights recently released the 1H-11 top 20 semicon sales leaders. No surprises here, with Intel, Samsung, TSMC, TI and Toshiba as the top five leaders in that order. In all, 10 of the top 20 suppliers outperformed the total global semiconductor industry 1H11/1H10 growth rate of 4 percent.

The fabless companies — notably, Qualcomm, Broadcom, and so on, have registered positive growths. However, if you really look carefully, a lot of the companies thereafter have registered negative growth for the period 1H-11 over 1H-10.

What’s surprising to notice is the fact that at least seven companies — Renesas, Hynix, Micron, AMD, Infineon, Elpida and NXP have registered negative growth! This, during a period when the semiconductor industry was said to be on the rebound?  Whatever the reasons, they are all in the red!

Now, we are not spent from discussing an industry turnaround, which is perhaps there!  Also, the forecast for 2H-11 isn’t something to go overboard. IC Insights expects the 2H11/1H11 semiconductor market to grow only 6 percent, that is, a full-year 2011 semiconductor industry growth rate of 5 percent.

Closer to home, as usual, there are no Indian firms in the global top 20 list. As things stand, they may not even make it to the list, at least, for quite a while. One hopes that this situation somehow changes. Wonder, how did the India Semiconductor Association (ISA)-Frost & Sullivan study come up with a figure of 28.3 percent growth in 2010! Perhaps, I am mistaken in my calculations somewhere!!

Congrats TSMC, for raising R&D spend! But, what about Indian firms?

January 18, 2011 Comments off

Source: IC Insights, USA.

Source: IC Insights, USA.

Congratulations to TSMC  for making it to the top 10 R&D spenders during 2010! If you look at the IC Insights’ table (see here), you’d understand what I am referring to!

First, the table itself. It has no major surprises, barring TSMC, which again is not really a surprise. As IC Insights itself says, “The industry is increasingly dependent on the success (and hopefully not, failure) of the foundries to continue advancing their IC manufacturing capabilities.”

TSMC has jumped up from 19th to the 10th place in the latest R&D spend. IC Insights expects that TSMC’s R&D spending in 2011 will grow another 20 percent, putting its budget over $1.1 billion for the year.

Otherwise, the top 9 in the list consist of Intel, Samsung, ST, Renesas, Broadcom, Toshiba, Qualcomm, TI and AMD — all big, strong players. However, TSMC, is the only foundry in that list, at the 10th spot.

Now, all of this makes great reading! Everyone connected with the global semiconductor industry is very well aware of TSMC’s strengths and capabilities.

The more TSMC grows in stature, the more will its capabilities grow. A lot of firms have already exited the manufacturing industry, leaving that to the likes of TSMC and others, and some more are due soon.

However, I am thoroughly disappointed by some folks who touch upon India missing out on the R&D story.  More of that in a bit!

First. where is the R&D strength of India? There are firms, based outside the country, managed by Indians, who seem to look down on the country. I even received an email from a gentleman, which says: ‘Without semiconductors, India cannot gain technological advantage. Semiconductor should be funded by the defense budget.” I am appalled!

Well, we are trying, aren’t we? There are names that come to the mind — Procsys, Ittiam, SoftJin, eInfochips, MindTree, and so on! Yes, I know they aren’t exactly world beaters. But hey, they are all doing their own thing reasonably well!

More ‘fabless IC billionaires’ in 2010, says IC Insights! Is India listening?

December 22, 2010 5 comments

Brilliant! There’s no other word to describe the first part of this headline!

As per IC Insights’ forecast of 2010 billion-dollar fabless IC suppliers, excerpted from a ranking of top 50 fabless IC suppliers in its ‘ 2011 edition of The McClean Report’, as many as 13 fabless IC suppliers are tipped to cross the $1-billion mark in sales in 2010! As per IC Insights, this is a significant step up — from 10 companies in 2009 and eight in 2008.

Leading fabless IC suppliers. Source: IC Insight, USA.

Leading fabless IC suppliers. Source: IC Insight, USA.

Just sit back and admire this table. There are nine firms from the US — Qualcomm, Broadcom, AMD, Marvell, Nvidia, Xilinx, Altera, LSI and Avago, three from Taiwan — MediaTek, Novatek and MStar, while ST-Ericsson is Europe’s lone representation in this stellar list.

In this august club of IC billionaires, no surprises, but Qualcomm retains the top place for the third consecutive year. Broadcom moves up a place. AMD should become the world’s third largest player.

Broadcom at 53 percent, Marvell at 34 percent, Xilinx at 39 percent, Altera at 63 percent, Avago and Novatek at 40 percent each are top performers. However, MStar of Taiwan steals the show with an estimated 75 percent growth in 2010.

Qualcomm, Nvidia and LSI have performed well, especially  the last two – coming pff a difficult 2009. Taiwan’s MediaTek has seen the biggest slip — down to 3 percent in 2010 from 22 percent in 2009.

There is no representation from Japan in the fabless IC billionaires club. IC Insights has indicated that the fabless/foundry hasn’t caught on in Japan and is unlikely to do so in the near future. However, Taiwan and China based firms should sooner or later find their way into this club.

I will now come to India! Read more…

Top 20 global semicon suppliers of 2010!

December 16, 2010 1 comment

I’ve just received this report from iSuppli, which says that the global semiconductor revenue expands by record margin in 2010 — to $304 billion in 2010, up from $229.5 billion in 2009. This represents growth of 32.5 percent for the year! Fantastic!!

This growth is said to be courtesy of a boom in DRAM and NAND sales benefiting memory suppliers. One hopes the semicon industry turns in an equally better performance in 2011. That’d be just great!

In the meantime, I’d like to share with you iSuppli’s preliminary ranking of the Top 20 semiconductor suppliers in 2010.

Top 20 semiconductor suppliers of 2010: Source: iSuppli, USA.

Top 20 semiconductor suppliers of 2010: Source: iSuppli, USA.

As per iSuppli, Marvell is likely to achieve organic revenue growth of more than 43 percent and jump five places to the No. 18 spot in 2010.

Qualcomm and AMD, and Sony have experienced revenue growth notably less than the overall market. Therefore, they will likely slip three to four positions in the rankings in 2010.

After a number of years of dramatically outperforming the market, Taiwan’s MediaTek fell back to earth in 2010, as it will barely achieve revenue growth at 1.2 percent, the only company among the Top 20 to not achieve a double-digit increase. The company is likely to slip to No. 19 in the rankings, down from No. 16 place in 2009.

Only one company is at risk of dropping out of the list of 20. iSuppli projects that nVidia will retain its ranking at No. 20. However, ROHM Semiconductor is competing for the final slot among the Top 20 and the final outcome should be very close.

I hope to get into a conversation with iSuppli regarding the top 20 semicon suppliers.

AMD, Intel settle all disputes! What a relief!!

November 12, 2009 Comments off

The big news: Intel and AMD announced a comprehensive agreement to end all outstanding legal disputes between the companies, including antitrust litigation and patent cross license disputes! What a relief!

In a joint statement the two companies commented, “While the relationship between the two companies has been difficult in the past, this agreement ends the legal disputes and enables the companies to focus all of our efforts on product innovation and development.”

As per the agreement the two companies obtain patent rights from a new five-year cross license agreement, Intel and AMD will give up any claims of breach from the previous license agreement, and Intel will pay AMD $1.25 billion. Intel has also agreed to abide by a set of business practice provisions.

AMD will drop all pending litigation including the case in US District Court in Delaware and two cases pending in Japan. AMD will also withdraw all of its regulatory complaints worldwide.

Ramkumar Subramanian, VP, Sales & Marketing, AMD India, said: “This is a historical settlement for the microprocessor industry. The settlement will set transparent ground rules for open, competitive markets, with which Intel, in full public view, has agreed to comply. Fair and open competition dictates that the best product wins and market forces prevail. I am very confident that this development will help us strengthen our market position.”

This is just the kind of news the global semiconductor industry needs! It is hopefully, on path of a major recovery after having faced the worst recession.

It is heartening to note that the two rivals have buried the hatchet and shaken hands — a plea I’ve been making via my blog posts for such a long time.

It would do both Intel and AMD a world of good to focus on their core competencies and continue to produce all of those magnificent chips that make all of our lives so easy and meaningful!

Good work guys and congratulations. May you have all the success and lead the global semiconductor industry to greater heights in the future.

Top 20 semicon rankings Q2-09 — TSMC climbs up, AMD slips down!

July 31, 2009 Comments off

Very interesting, isn’t it? And I am not surprised! TSMC deserves to move up the top 20 semiconductor companies rankings!! It seems that AMD especially needs to really get its act together.

First, to the rankings. Recently, IC Insights released the list of the top 20 semiconductor sales leaders during Q2-09.Source: IC Insights

In this list, there are four fabless semiconductor companies — Qualcomm, Broadcom, MediaTek and Nvidia in the top 20, and one foundry — TSMC, perhaps, emphasizing the growing influence of TSMC as well as the fabless semiconductor companies.

AMD slips! Again?
I had written a couple of posts some time back on AMD and Intel, where the former had commented on the EC ruling on Intel, and also how both were at each other’s throats, and had asked the question — how will all of this help the market?

Well, one hopes that AMD will come back very much stronger in the next quarter, despite its uninspiring guidance for 3Q09, saying that it expects its sales to be “up slightly” from 2Q09.

TSMC, Hynix, MediaTek shine
Coming back to the table, the clear movers are TSMC, and no surprises there, as well as Hynix and MediaTek. In fact, with a little better Q3 performance, TSMC could well move up to the third position, overtaking both Texas Instruments and Toshiba.

Look at the last column — the 2Q09/1Q09 percentage change — TSMC has grown by a whopping 93 percent! One other thing! TSMC is reportedly eyeing business opportunities in solar photovoltaics and LEDs in a bid to diversify its revenue channels. Should these happen, expect TSMC to move up higher!

The closest to TSMC in terms of growth are Hynix at 40 percent and Qualcomm at 36 percent, respectively. MediaTek, another impressive mover, grew by 20 percent. Of course, there is Samsung as well, with 29 percent growth.

ST, Micron, Nvidia and NXP have done well too! According to IC Insights, Nvidia replaced Fujitsu in the Q2-09 top 20 rankings. And that brings us to the shakers or those who fared poorly.

Fujitsu, AMD, Freescale slide!
I’ve already touched upon AMD. Fujitsu cited flash memory and automotive device sales to have suffered immensely this quarter. However, it hopes Q3 will be better and said that customer demand was picking up. So, it could well be back in the Top 20 during Q3.

Yet another slip was in store for Freescale. It slipped from 16th position in 2008 to 18th position during Q1-09, and slid further to 20th position in Q2-09. Perhaps, overdependance on automotives has been its undoing.

An interesting statistic from IC Insights — Fujitsu, with -9 percent and Freescale, with -2 percent growth, were the only two top-20 companies from Q1-09 to register a 2Q09/1Q09 sales decline!

Wonderful industry guidance
It is heartening to see 19 of the 20 companies registering positive growth this quarter. It won’t be improper here to commend IC Insights on its wonderful industry guidance!

In an IC Insights study from late December 2008, it was very vocal in advising firms to adopt a quarterly outlook! It also forecast a significant rebound in the IC market beginning in the third quarter of the year!

IC Insights also stood out by pointing out in early July that H2-09 is likely to usher in strong seasonal strength for electronic system sales, a period of IC inventory replenishment, which began in 2Q09, and positive worldwide GDP growth.

IC Insights had marked 4Q08 as the beginning of the downturn/collapse and Q1-09 as the bottom of the cycle. This quarter (Q2) has largely been a replenishment phase for the inventories. Going by that count, Q3 could well see a true seasonal increase in demand. IC Insights also said that during Q4-09, market growth will mirror the health of the worldwide economy and electronic system sales.

There is light, after all, at the end of the tunnel! Wonder why are the industry folks continue to tell each other — we still aren’t having a good time! Maybe, it is time for them to shed their pessimism and from holding back on investments, and move on to show steely optimism, and indulge in really aggressive buying and selling! After all, work and progress will happen ONLY if you work!!

Semicon recovery in sight? Hope both Intel and AMD are ready — for today, and tomorrow!

June 11, 2009 Comments off

Where were we? Yes, the famous Intel and AMD server battle, and Computex!

Is server battle the only ground Intel and AMD are and should be looking at? Perhaps, not! Has AMD won the server battle? Perhaps, yes, in this particular round, for now, as statistics may suggest. However, statistics also have a bad habit of hiding certain vital statistics — like conditions, etc.

A couple of days ago, iSuppli reported that Intel had lost some share in the global microprocessor segment in Q1-2009. AMD, in fact, had managed a comeback.

As per iSuppli, Intel suffered a 2.5 point drop in share. Its global revenue dropped to 79.1 percent, down from 81.6 percent in Q4-2008. During the same period, AMD moved up from 10.5 percent to 12.8 percent — an increase of 2.3 points.

AMD’s turnaround has been attributed to its strong performances in each area of its microprocessor portfolio, particularly, notebooks. This is impressive, given the downturn and the weakness in the PC and server markets. So, is AMD a winner in the servers market? Not so soon!

The gap between Intel and AMD is still quite significant. We’ve had the EC ruling, we’ve had the various server platform launches, and we are done with Computex.

Recovery in the offing?
There have been indications from other quarters that the global semiconductor equipment market is likely to begin recovery by October 2009. Also, latest data from SEMI suggests an increase in investments for fab construction projects and fab equipping in H2-2009, with the trend continuing into 2010.

Further, iSuppli has also reported that after three quarters of contraction, the pure-play foundry semiconductor manufacturing industry will probably enjoy robust growth during the second quarter.

Given all of these interesting statistics and developments within the global semiconductor industry, a likely recovery for the industry could well be in the offing!

So, if AMD and Intel are done with their server wars, the real game is likely to begin shortly! Maybe, it is time for both to get over the “today and tomorrow affair,” and focus on the future. I hope both are adequately prepared for today, and tomorrow!

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