"Monthly updates provide timely information."
January 08, 2014
Samsung, TSMC, and Micron Top List of IC Industry Capacity Leaders
The top 10 companies now hold 67% of worldwide IC industry capacity, up from 54% in 2009.
Information in this Research Bulletin comes from the 2014 edition of IC Insights’ McClean report, which will be released later this month. The 800-page report includes over 400 charts and figures! IC Insights also offers its Global Wafer Capacity 2014 report, which provides even greater detail regarding IC industry capacity trends. Details of both these new reports are provided at the end of this bulletin.
A ranking of the industry’s 10 largest IC manufacturers in terms of installed capacity is provided in Figure 1. Included in the list are four from North America, two companies from South Korea, two from Taiwan, and one each from Europe and Japan.
As of December 2013, Samsung had the most installed wafer capacity with nearly 1.9 million 200mm-equivalent wafers per month! That represented 12.6% of the world’s total capacity and most of it used for the fabrication of DRAM and flash memory devices. Next in line was the largest pure-play foundry in the world TSMC with about 1.5 million wafers per month capacity, or 10.0% of total worldwide capacity. Following TSMC were memory IC suppliers Micron, Toshiba/SanDisk, and SK Hynix.
In January 2013, Micron and Nanya amended their Inotera partnership such that Micron now takes 95% of Inotera’s wafer output. Previously, Micron and Nanya evenly split Inotera’s capacity. Then, in July 2013, Micron finally closed the deal on its acquisition of Elpida Memory and the Rexchip business in Taiwan that Elpida operated in partnership with Powerchip. It took Micron a full year to complete the purchase after several delays with getting approvals from bondholders and governments. With the addition of the Elpida and Rexchip fabs as well as the extra Inotera capacity, Micron became the third-largest wafer capacity holder in the world in 2013 with nearly 1.4 million 200mm-equivalent wafers per month (9.3% of total worldwide capacity). At the end of 2012, Micron had the sixth-largest amount of wafer capacity.
The fourth-largest capacity holder at the end of 2013 was Toshiba with a little under 1.2 million in monthly wafer capacity (8.0% of total worldwide capacity), including a substantial amount of flash memory capacity for joint-investor/partner SanDisk. After Toshiba came another memory IC supplier SK Hynix with a little more than one million wafers/month (7.0% of total worldwide capacity). Rounding out the top six companies was Intel with 961K 200mm-equivalent wafers per month capacity, or 6.5% of total worldwide capacity. Just two years ago in 2011, Intel was the third-largest capacity leader, but in early 2012 the company reduced its ownership position in IM Flash as well as its wafer output share from its joint venture with Micron.
The three largest pure-play foundries—TSMC, GlobalFoundries, and UMC—are ranked in the top 10 listing of capacity leaders. In total, these three companies have held about 80% of the worldwide pure-play foundry market since 2010. Moreover, these three foundries had a combined capacity of about 2.5 million wafers per month as of December 2013, representing about 17% of the total fab capacity in the world.
The combined capacity of the top-5 leaders accounted for 47% of total worldwide capacity in Dec-2013. At the same time, just over two-thirds (67%) of the world’s capacity was represented by the combined capacity of the top-10 leaders, while the top 15 accounted for 76% and the top 25, 85%, of worldwide installed IC capacity in Dec-2013. It should be noted that the shares of these groups have each increased significantly since 2009. The top-5 group gained 11 percentage points; the top-10 group, 13 points; the top-15 group, 12 points; and the top-25 group, seven points. Those are big gains over the course of just four years!
IC manufacturing is increasingly becoming a high stakes poker game with enormous up-front costs. Today, it costs $4.0-$5.0 billion for a high-volume state-of-the-art 300mm wafer fab and the cost to build tomorrow’s 450mm wafer fab will probably be double that. Despite the cost-per-unit area advantage that larger wafers provide, there are fewer and fewer companies willing and able to continue investing that kind of money.
IC Insights believes that the capacity shares of the top 5, 10, 15, and 25 leaders will continue to increase over the next several years as the big get bigger, middle-tier manufacturers merge to consolidate resources and improve competitiveness, and a greater number of mid- to small-size companies move away from in-house IC fabrication and move toward using third-party foundries.
Rankings of IC manufacturers by installed capacity for each of the wafer sizes are shown in Figure 2. Looking at the ranking for 300mm wafer capacity, it is not surprising that the list includes only DRAM and flash memory suppliers like Samsung, Toshiba, Micron, SK Hynix, and Nanya; the industry’s biggest IC manufacturer and dominant MPU supplier Intel; and the world’s three largest pure-play foundries TSMC, GlobalFoundries, and UMC. These companies offer the types of ICs that benefit most from using the largest wafer size available to best amortize the manufacturing cost per die. The ranking for the smaller wafer sizes (i.e., ≤150mm) includes a more diversified group of companies.
A significant trend with regard to the industry’s IC manufacturing base, and a worrisome one from the perspective of companies that supply equipment and materials to chip makers, is that as the industry moves IC fabrication onto larger wafers in bigger fabs, the group of IC manufacturers continues to shrink in number. There are just 36% the number of companies that own and operate 300mm wafer fabs than 200mm fabs and the distribution of worldwide 300mm wafer capacity among those manufacturers is very top-heavy. Essentially, there are only about 15 companies that comprise the entire future total available market (TAM) for leading-edge IC fabrication equipment and materials. When 450mm wafer fabrication technology comes into production, this manufacturer group is predicted to shrink even further to a maximum of just 10 companies.
Coming in Late January — The 2014 McClean Report
IC Insights is putting the finishing touches on the 2014 edition of its flagship report, The McClean Report—A Complete Analysis and Forecast of the Integrated Circuit Industry. This highly regarded service features more than 800 pages and more than 400 tables and graphs that provide the user with a thorough overview and analysis of IC industry trends throughout the year. A subscription to The McClean Report includes free attendance to one of The McClean Report half-day seminars that are presented by IC Insights’ President Bill McClean in January. The McClean Report seminars will be held in the following locations:
• Scottsdale, Arizona on Tuesday, January 21
• Sunnyvale, California on Thursday, January 23
• Boston, Massachusetts on Tuesday, January 28
• London, England on Thursday, January 30
In addition to the seminar, a subscription to The McClean Report includes free monthly updates from March through November (including a 250+ page Mid-Year Update), and free access to subscriber-only webinars throughout the year. An individual-user license to the 2014 edition of The McClean Report is priced at $3,490 and includes an Internet access password. A multi-user worldwide corporate license is available for $6,490.
Report Details: Global Wafer Capacity 2014
Additional details and a forecast of the IC industry’s wafer fab capacity through 2018 are provided in IC Insights’ Global Wafer Capacity 2014—Detailed Analysis and Forecast of the IC Industry’s Wafer Fab Capacity report. Released in December 2013, the Global Wafer Capacity report assesses the IC industry’s capacity by wafer size, minimum process geometry, technology type, geographic region, and by device type through 2018. The report also includes detailed profiles of the companies most likely to build 450mm wafer fabs and gives detailed specifications on existing wafer fab facilities. Coupled with IC Insights’ Strategic Reviews database of more than 220 company profiles, the two provide a tremendous resource for researching, evaluating, and comparing wafer fab facilities and industry capacity. Global Wafer Capacity 2014 is priced at $4,290 for an individual user password. A multi-user worldwide corporate license is available for $6,990.
Receive Research Bulletins in your inbox: Join Our Mail List