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Pure-play foundries, fabless suppliers dominate IC ranking

Posted: 02 Apr 2013 ?? ?Print Version ?Bookmark and Share

Keywords:pure-play foundries? fabless suppliers? IC manufacturers? McClean Report?

In total, the top 25 semiconductor companies' sales declined by 1 per cent in 2012, two points less than the total worldwide semiconductor market decline of 3 per cent. It took semiconductor sales of at least $3 billion in 2012 to make the top 25 ranking, about the same dollar amount needed to construct a 10K wafer-per-month 300mm wafer fabrication facility.

Intel remained firmly in control of the number one spot in the ranking in 2012. In fact, Intel, helped by its acquisition of Infineon's wireless IC business, extended its lead over second-ranked Samsung by registering a 52 per cent higher semiconductor sales level than Samsung in 2012 as compared to a 24 per cent margin in 2010. The only movement with regard to the top five spots in the 2012 ranking was that fabless supplier Qualcomm registered a 34 per cent surge in sales and moved up three positions to replace TI as the fourth-largest semiconductor supplier.

Ranking by growth

Figure 2: 2012 Top 25 semiconductor sales leaders ranked by growth rate ($M, including foundries)
Source: IC Insights' Strategic Reviews Database

After its 21 per cent drop in sales in 2012, Elpida, which is due to be acquired by Micron sometime in the first half of 2013, fell five spots in the top 25 ranking going from 19th place in 2011 to 24th place in 2012. However, if Micron and Elpida's 2012 sales were combined, the "new" company would have had $11,077 million in total sales and would have been ranked as the seventh-largest semiconductor supplier, only $140 million behind sixth-ranked Toshiba.

New entrants into the top 25 ranking in 2012 included Taiwan-based fabless communications chip specialist MediaTek, which moved from being ranked 26th in 2011 to 21st in 2012. MediaTek is Taiwan's largest non-foundry semiconductor supplier. Japan-based Sharp jumped five positions in the ranking last year and moved into the 22nd spot. Sharp's 14 per cent total semiconductor sales increase in 2012 was spurred by a 20 per cent surge in its O-S-D sales.

Figure 2 shows that there was a wide range of growth rates among the worldwide top 25 semiconductor suppliers last year. It is interesting to note that despite the close on-going relationship between GlobalFoundries (31 per cent increase) and AMD (17 per cent decline), the two companies were at opposite ends of the growth spectrum in 2012. Considering that AMD, the original "parent" and largest customer of GlobalFoundries, suffered such a steep sales decline last year, it is obvious that GlobalFoundries' spike in revenue in 2012 was driven mostly by its success in attracting new IC foundry customers (e.g., ST, Freescale, Qualcomm, etc.).

The continued success of the fabless/foundry business model is evident when examining the top 25 semiconductor suppliers ranked by growth rate. As shown, the top seven performers included four fabless companies (Qualcomm, MediaTek, Broadcom and Nvidia) and two pure-play foundries (GlobalFoundries and TSMC).

Illustrating the very difficult year faced by the majority of the top 25 semiconductor suppliers, 17 of the top 25 ranked companies registered a sales decline last year, including 8 of the top 10 largest semiconductor suppliers in the world (#1 Intel, #2 Samsung, #5 TI, #6 Toshiba, #7 Renesas, #8 SK Hynix, #9 ST, and #10 Micron). Of the seven top 25 semiconductor companies that registered a sales increase in 2012, four are headquartered in the U.S. and include Qualcomm, GlobalFoundries, Broadcom and Nvidia.

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