A seasonal slowdown in orders for smartphones and tablets will drag down sales at Taiwan Semiconductor Manufacturing Company (TSMC) in the first quarter of 2013. The foundry is expected to report a 7-11% sequential decrease in consolidated revenues for the quarter, according to industry watchers.
TSMC's major clients including Qualcomm, Broadcom, NXP and Texas Instruments (TI) have started to slow down orders recently amid inventory adjustments. The foundry will likely see the negative impacts continue until March, the watchers indicated.
With the iPhone 5 fever now cooling, and several smartphone vendors transitioning from old to new products, international chip suppliers are expected to cut their orders to TSMC by 5-10% in the first quarter, the watchers said.
Meanwhile, MediaTek and Spreadtrum will also lower their wafer starts at TSMC by 10-20% on quarter, the watchers noted. The foundry is forecast to post a shipment decline of 10-15% sequentially in the first quarter, the watchers added.
MediaTek and Spreadtrum both target mainly the market for entry-level and mid-range smartphones in China. Replacement demand for smartphones in China and other emerging markets was previously identified as the possible contributing factor to a particularly strong first quarter for TSMC, the watchers pointed out.
Monthly sales at TSMC will stay below the NT$40 billion (US$1.38 billion) mark in January and February, the watchers estimated.
TSMC has announced that consolidated revenues for December 2012 declined 16% sequentially to NT$37.11 billion, hitting the lowest level in nine months.
A slowdown in smartphone demand will dampen TSMC 1Q13 sales
Digitimes file photo
Article translated by Jessie Shen
