SICAS is dead (and WSTS isn’t feeling too good)

The SICAS (Semiconductor Industry Capacity Statistics) program has been discontinued after the release of the 4Q 2011 data, available through the SIA at http://www.sia-online.org/industry-statistics/semiconductor-capacity-utilization-sicas-reports/

The latest report stated: “Due to significant changes in the SICAS program participation base in 2011, the quarterly SICAS capacity and utilization report will be discontinued, effective Quarter 1 2012.” SICAS lost the Taiwanese companies Nanya Technology, Taiwan Semiconductor Manufacturing Company Ltd. (TSMC) and United Microelectronics Corporation (UMC) beginning in 2Q 2011. SICAS members likely questioned the value of continued participation without the two largest wafer foundry companies.

The end of SICAS is a major disappointment. The semiconductor industry has lost the definitive source of capacity and utilization data, a key component in determining the current and near term industry conditions. It is especially disappointing to me since I served on the founding executive committee of SICAS in 1995.

The death of SICAS follows the withdrawal of Intel and Advanced Micro Devices (AMD) from World Semiconductor Trade Statistics (WSTS) as originally reported in the Wall Street Journal: http://www.djnewsplus.com/rssarticle/SB133045771410082239.html
Without Intel and AMD, it will be extremely difficult for WSTS to report accurate statistics for microprocessors. Intel and AMD account for over 90% of the microprocessor market and microprocessors account for about 15% of the semiconductor market. WSTS may need to drop microprocessors from its product coverage, which would result in WSTS no longer being a reliable source of data on the overall semiconductor market.

As with the loss of SICAS, the loss of Intel and AMD in WSTS is a significant disappointment. I was Texas Instrument’s representative to WSTS for 14 years and served a term as WSTS chairperson. However I believe WSTS will adapt and survive. The organization provides detail on numerous product and application markets which provide vital information to member companies and industry analysts.

Final SICAS data

The chart below shows SICAS data for total IC capacity in thousands of eight-inch equivalent wafers per week. Capacity for TSMC and UMC was added to the SICAS capacity beginning with 2Q 2011 for comparison with prior quarters. 4Q 2011 IC capacity (including TSMC and UMC) was 2,205 thousand wafers, up 2.5% from 2,151 thousand in 3Q 2011 and the seventh consecutive quarterly increase. IC capacity in 4Q 2011 was just 1% below the record capacity of 2,223 thousand wafers in 3Q 2008 and was up 14% from the cyclical low of 1,927 thousand wafers in 3Q 2009.

The trend for MOS IC capacity utilization is shown in the chart below. The SICAS data on capacity utilization for MOS ICs excluding foundry wafers was used through 1Q 2011. This data series is fairly comparable to the 2Q-4Q 2011 SICAS total MOS IC capacity utilization which does not included TSMC and UMC. For the current cycle, utilization peaked at 94.9% in 2Q 2010. 4Q 2011 utilization dropped to 88.9%, the lowest level since 88.8% in 4Q 2009. The 4Q 2011 drop in utilization was expected due to the weak semiconductor market – primarily caused by floods in Thailand disrupting HDD production and economic weakness in Europe.

Capacity utilization will likely recover by 2Q 2012. Digitimes say industry sources expect TSMC’s 2Q 2012 utilization to be around 95% due to strong orders. Capacity growth in 1Q 2012 should be relatively flat. Combined data on semiconductor manufacturing equipment bookings and billings from SEMI and SEAJ shows billings have declined in each of the last three quarters, with 4Q 2011 down 24% from 1Q 2011. Bookings began to pick up in 4Q 2011, indicating capacity growth should resume by the second half of 2012. Year 2012 billings were $34 billion, up 8.8% from 2011. SEMI forecasts 18% growth in fab equipment spending in 2013.