Analysis of the China semiconductor foundry sector, 2013

As the level of technology in China's IC design industry has increased and the industry has successfully transitioned to mobile communications IC products, some of the IC design firms concerned have made extensive capital gains through IPO listings, a phenomenon that has only served to attract more China-based companies into the IC design industry. The country's total number of IC design firms had already risen to 534 in 2012, providing further evidence that the China IC design industry has apparently entered a new growth cycle.

Strong domestic demand in China has helped the China industry to avoid the worst of the inventory adjustment problems experienced by major global chip makers and the effects of the European debt crisis; the China industry's output value reached US$3.53 billion in 2012, representing 16.3% growth on the 2011 figure of US$3.04 billion.

While there is little doubt that the China IC design industry is flourishing, the actual size of its output value is less certain.

In addition to analysis and forecasts for the China foundry industry's output value in 2013, this report makes use of cost structure analysis for IC design firms in the Greater China region, calculations of Greater China-based foundry companies' revenues from the China market and of the value created by foundry companies in the Greater China region for the China semiconductor industry, to estimate the output value of the China IC design industry and the changes in this figure, as well as Greater China-based foundry companies' share of the China foundry market.