Global foundry revenue is projected to rise 23.8% YoY in 2020, the highest percentage seen for 10 years, according to tech industry research from TrendForce.
The bullish semiconductor market driven by WFH, distance learning, 5G, and strong component demand from telecom build-outs is “defying the economic headwinds” and leaving many 8-inch wafer in short supply.
“Notably, 8-inch wafer capacity has been in severe shortage since 2H19, as almost no suppliers still currently produce 8-inch semiconductor equipment, meaning the price for such equipment has now skyrocketed. Moreover, since 8-inch wafer prices are relatively low in comparison to 12-inch wafer prices, foundries generally find it cost-ineffective to expand their 8-inch capacities,” reports TrendForce.
“However, as it is significantly more cost-effective to manufacture products such as PMIC (Power management ICs) and LDDI (large display driver ICs) in 8-inch fabs, foundries may deem it unnecessary to transition to 12-inch fabs or even advanced nodes for these products.
“Demand for PMICs, used in smartphones and base stations, has undergone an exponential growth with the arrival of the 5G era, further exacerbating the existing tight supply of 8-inch wafer capacity. Therefore, although manufacturing operations for some products may gradually transition from 8-inch fabs to 12-inch fabs, the shortage of 8-inch wafer capacities is unlikely to be alleviated in the short run.”
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