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TSMC may step beyond Q2 guidance

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CIOL Bureau
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SAN JOSE, USA: Taiwan Semiconductor Manufacturing Co, though had recently said that that it had resolved its 40-nm yield issues following a management change, is likely to go beyond its second-quarter guidance.

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However, 40-nm yields and a pattern of double ordering at the foundry giant have given rise to increased concern.

Analysts believe that though Taiwan Semiconductor will exceed the second quarter guidance range, shipments and revenue momentum for the second half 2009 are seen as shaky.

It may be noted that earlier analyses had pointed out that 40-nm yields have remained below 30 per cent, which could result in a body blow to shipments in the second half of 2009.

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It is being pointed out that yields are as low as 30 per cent and the blame is on the recent management change. Morris Chang had reassumed control of TSMC recenty after the board named Chang to serve as chief executive, along with his current position as chairman.

Meanwhile, analaysts also said that there are more worries at TSMC. Increased wafer and die banks have recently caused some key customers, such Qualcomm, to cancel rush orders that carry shorter manufacturing lead times, with higher average selling prices, making it tough for TSMC.

Besides, Customers double ordering is also a reason for concern. TSMC's sales are projected to hit $2.3 billion in second quarter, up 90 per cent from the previous period but down 14.8 per cent from last year.

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