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The Tech Week that was January 27-31 2020

The Tech Week that was January 27-31 2020
by Mark Dyson on 02-02-2020 at 6:00 am

Semiconductor Weekly Summary 1

This week the Coronavirus has been escalated to a Global Health Emergency status by the WHO, China extended the Chinese New Year shutdown to 9th February and many companies have implemented a travel ban on business travel to/from China or Asia as well as implementing other business continuity procedures. The last crisis in 2003 from SARS was estimated to have cost the global economy US$40billion and shut down the Chinese semiconductor industry for months. Already the number of infected people with the Coronavirus is more than SARS, though luckily so far the fatality rate seems to be much lower. Already many companies are seeing the first impact of this crisis and are desperately trying to get a full understanding of the total supply chain impact which is difficult to accurately gauge at present as many people in China have not returned back to work. This is not good for an industry that was just starting to recover from a challenging year last year.

As we start the new year Semiconductor Packaging News has been running a series of articles from various leaders in the industry with their forecasts for 2020. Lena Nicolaides from KLA expects semiconductor packaging growth to be very strong in 2020 with adoption of advanced packaging solutions. Jim Faine from Marvin Test solutions expects 5G and autonomous cars to be the main growth areas. Ram Trichur from Henkel Corporation expects 2020 to be a growth year, with solid gains across semiconductor packaging applications driven by 5G telecom and mobile electronics, and by some specific growth areas within the automotive/industrial and datacenter/memory sectors.  David Butler from SPTS Technologies Inc is very optimistic about the prospects for advanced package technology in 2020 driven by the roll out of 5G. David Wang from ACM Research sees opportunity from the trade war in being able to do business in both China and US through it’s US headquarters and Shanghai based wholly owned subsidiary at a time when many US equipment suppliers are concerned about doing business in China.

Latest economic data from Taiwan shows that Taiwan is one of the main winners economically last year reporting a GDP growth of 2.73% for 2019 as a whole and a 4th quarter GDP growth of 3.38%. Taiwan is particularly benefitting from the trade war as it sees increased orders from both China and US.

SEMI has released it’s North American semiconductor equipment sales report showing that billings were 17.5% higher in December than in November, with total billings of US$2.49billion.

Apple reported a solid Q1 2020 for the quarter just finished due to increased iPhone sales. For fiscal Q1 they reported all time record revenue of US$91.8billion, and they are forecasting revenue for Q2 of US$62.4 billion as it believes that its phones and other devices such as AirPods wireless headphones will continue to sell well during what is often a slow time of year.

AMD reported revenues of US$2.13billion in Q4 increasing 50% yoy and up 18% sequentially. AMD are projecting revenue of US$1.8billion in Q1, this is up 42% yoy but down 15% sequentially. For 2019 as a whole AMD reported record annual revenue of US$6.73billion, up 4% yoy. For 2020 as a whole it is expecting revenue growth of about 28% to 30% year-over-year.

Xilinx reported a decrease in revenue in Q3 which ended December, total revenue was US$723.5million, down 10% yoy and down 13% sequentially, as it suffered from the US China trade war and particularly from the trade restrictions on dealing with Huawei as well as the slower than expected deployment of 5G technology. As result it has announced it plans to cut about 7% of its worldwide workforce. For the coming fiscal Q4, they are forecasting revenues with a midpoint of US$765million.

Cree announced its fiscal Q2 earnings reporting revenue of US$240 which is a 14% yoy decrease and a 1% sequential decline due to lower LED segment revenue and weakness for power and RF device sales. They also announced that recently their application for a licence to ship to Huawei was turned down. Despite the short term headwinds they see a growing momentum for their silicon carbide technology. Cree is forecasting revenue for the current fiscal Q3 with a midpoint of US$225million.

Finally a report by the US Department of Energy predicts that due to the adoption of LED lamps in the US general lighting market this will produce energy savings of more than 569 terawatt hours annually by 2035, equal to the annual power output of more than 92 1,000 mega-watt power plants.

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