TAIPEI (Taiwan News) — Revenue for Taiwan Semiconductor Manufacturing Company (TSMC) and other global foundries is expected to have reached US$84.6 billion in 2020, representing 23.7 percent year-over-year growth, the most in nearly a decade.
According to market research firm TrendForce, demand for chips in the first half of 2020 was fueled by the COVID-19 pandemic, which affected purchases of products related to working from home and distance education. Growth in the second half of the year was attributed to demand for Huawei components caused by U.S. sanctions in addition to increased 5G smartphone sales and 5G base station build-outs.
TrendForce predicts that chip sales in 2021 will continue to be driven by pandemic-related demand for networking products and the stay-at-home economy. Sales of smartphones, servers, notebooks, TV, and cars in combination with the continued rollout of next-generation networks, including 5G base stations and WiFi 6 technologies, are expected to push revenue for the foundry industry in 2021 to an all-time high of US$89.6 billion, or 6 percent year-over-year growth.
TSMC’s capacity utilization rate for advanced 5 nm processes and below is predicted to be around 90 percent due to U.S. sanctions barring Huawei subsidiary HiSilicon from purchasing TSMC chips. Meanwhile, Apple — TSMC’s main client for 5 nm chips — will be unable to make up for the loss of HiSilicon.
Utilization rates for TSMC’s 7 nm node are expected to be at full capacity through the second quarter of 2021 due to high demand from AMD and MediaTek. Samsung’s 7/5 nm nodes are also forecasted to be at full capacity during the same period thanks to Nvidia and Qualcomm orders.
Looking to the second half of 2021 through 2022, both TSMC and Samsung plan to expand their 5 nm capacities to meet demand for high-performance computing components in 2022. TrendForce forecasts production capacities for advanced processes in 2022 will remain tight due to rapid growth in the high-performance computing market and increased Intel orders, which is expected to speed up the outsourcing of its production.
