NAND flash controller specialists Phison Electronics and Silicon Motion Technology have placed orders for 2022 with their foundry partners, but are still aware tight mature process capacity may disrupt their shipments next year, according to industry sources.
Insufficient foundry capacity support has become a major factor affecting shipments of NAND flash controller chips for storage devices in 2021, and demand for such chips will remain strong for datacenter, PC and handset applications, prompting Phison and Silicon Motion to advance placing foundry orders for 2022, the sources said. Both vendors have also seen clear order visibility for their products through 2022.
TSMC has completed its first round of talks with major clients about capacity allocation for 2022, with chips clients in the segments of handsets, PCs, automotive electronics and HPC devices receiving slightly higher capacity quotas than 2021, the sources said. But their allocated capacities are still less than half of what they were asking for, the sources added.
UMC is also expected to settle its capacity allocation for 2022 later in the second quarter of 2021, indicating that chip vendors' revenue performance for next year may be determined by whether they can win more foundry capacity as early as second-quarter this year, the sources said.
Silicon Motion president Wallace Kou has said that wafer foundry capacity shortages will be even more severe in 2022, especially mature process nodes for 8-inch wafers, prompting chipmakers to turn to 28nm node, which is expected to become a target in their next wave of capacity competition.
Phison chairman KS Pua has also noted NAND controllers will see fastest growth in handset, PC and notebook applications in the next two years, and his company will prioritize high-capacity storage applications under tight foundry capacity and will gradually reduce the shipment ratio for consumer applications to under 20% in 2023 from 30% in 2020.
