March 28, 2006 – Revenue from Taiwan’s IC industry rose 1.7% in 2005 to NT$1.12 trillion (US $34.34 billion), well below the total global industry’s ~7% growth for the year, according to new figures from the Taiwan Semiconductor Industry Association and Industrial Technology Research Institute. But the region is expected to rebound in 2006 with nearly 16% growth, which would beat most analysts’ general expectation of total ~8%-10% total industry growth.
Taiwan’s IC manufacturing segment was the big downer in 2005, falling nearly 6% to NT$587.4 billion ($18.05 billion) due to a flat 2Q performance, thanks to inventory buildups from late 2004 that had to be worked off early in the year. Manufacturing sales strengthened later in the year thanks to stabilizing DRAM prices as many memory chipmakers switched over to NAND flash. The domestic industry’s backend segment performed better, with overall packaging up 13.7% to NT$178.0 billion ($5.47 billion), and testing up 17.0% to NT$67.5 billion ($2.07 billion), thanks to strong demand for DRAM and NAND flash testing, as well as for logic and mixed-signal tests for devices targeting consumer electronics. Fabless sector sales rose 9.3% during the year to NT$285.0 billion ($8.76 billion), less than the previous year but still outperforming the overall domestic chip industry.
For 2006, ITRI/TSIA project Taiwan’s overall IC industry will return to double-digit growth, to NT$1.30 trillion ($39.82 billion), with the manufacturing sector rebounding with 14.2% growth to NT$671.0 billion ($20.61 billion), including 19.1% growth for foundries. Backend segments are also expected to increase to 24%-26 growth, with 12% growth among fabless companies.
Taiwan IC Industry, 2005 revenues by segment (NT $B)
2005Q1 2005Q2 2005Q3 2005Q4 2005 2005/2004 2006(e) 2006/2005
IC fabless 57.5 64.7 78.0 84.8 285.0 9.3% 320.0 12.3%
IC manufacturing 130.0 130.6 156.1 170.7 587.4 -5.9% 671.0 14.2%
(Foundry 80.2 82.8 98.0 112.5 373.5 -6.3% 445.0 19.1%)
IC packaging 37.9 41.0 45.8 53.3 178.0 13.7% 220.0 23.6%
(Domestic packaging 31.5 34.1 38.4 45.0 149.0 13.6% 186.4 25.1%)
IC Testing 15.3 16.1 17.1 19.0 67.5 17.0% 85.2 26.2%
Indstry revenues 240.7 252.4 297.0 327.8 1,117.9 1.7% 1,296.2 15.9%