Xu Xiulan, chairman of Universal Crystal, said at the law conference yesterday (2) that due to the sluggish semiconductor market, customers want to delay the increase of products, and the operation of this season is facing challenges. The 8-inch and 12-inch silicon wafer production lines are operating at full capacity. No longer, the expansion plan of existing factories in the United States will also be postponed for one to two quarters.
Xu Xiulan expects that the overall semiconductor market situation should gradually recover in the second half of this year or early next year; as far as Global Crystal is concerned, the performance in the third and fourth quarters of this year is expected to pick up and be better than the second quarter, but it is still unpredictable increase.
Universal Crystal is the largest semiconductor silicon wafer factory in Taiwan and the third largest in the world. It supplies the most important raw materials for the semiconductor industry. Its customers include TSMC, Samsung and other international manufacturers. Its operating outlook reflects the production dynamics of semiconductor index factories. Xu Xiulan believes that the operation of Global Crystal is facing challenges this season, and revealed that the semiconductor market is still in a downturn this season, and it will have to wait for the second half of the year to turn around.
As for the advance payment dynamics of long-term contract customers, according to the statistics of Global Crystal, as of the end of the first quarter of this year, the advance payment for goods was US$1.27 billion (about NT$38.51 billion), which was slightly lower than the US$1.29 billion (about NT$39.73 billion) at the end of last year. significantly reduced.
Talking about the operating outlook, Xu Xiulan said frankly that the current market situation continues the trend since the second half of last year. Affected by multiple factors such as inventory accumulation and declining demand for consumer electronics, customer demand has slowed down this season. Challenges, revenue will decline from the previous quarter. Xu Xiulan pointed out that there is no good news in the short term. Although customer inventory has declined, the decline is less than expected. It may not be until the second half of 2023 or 2024. The situation will be better, and there are still challenges in the second quarter.
Affected by the sluggish market conditions, Global Crystal’s capacity utilization rate showed signs of loosening. Xu Xiulan mentioned that the capacity utilization rate of 6-inch silicon wafers has not been fully loaded since the fourth quarter of last year, and is currently about 70%; the 8-inch and 12-inch silicon wafer production lines are still fully loaded in the first quarter of this year, and customer demand slowed down in the second quarter. The full-load operation of related product lines is no longer the grand occasion, but it still maintains above 90%.
In response to mid-to-long-term development, Universal Crystal continues to implement plans for new plants in the United States and expansion plans for existing plants. The former will be mass-produced in the first quarter of 2025, while the progress of some plants in the latter will be slightly delayed by one or two quarters for some reason. As for the plan to expand the 12-inch production capacity at the Italian factory, Xu Xiulan said that the company has continued to have good communication with relevant European units, but still has to wait for the official results.
Global Crystal believes that according to the forecast of the International Monetary Fund (IMF), the global economic growth rate will be revised down from 3.4% in 2022 to 2.8% in 2023, and it is expected to rebound to 3% in 2024. Factors such as interest rate hike policies of various countries, the war between Russia and Ukraine, and geoeconomic divisions will continue to put pressure on global economic activities.
In terms of the semiconductor market, benefiting from market drivers such as servers, data centers, industrial and automotive electronics, it is estimated that the revenue of the semiconductor industry this year will be the same as that in 2022, but the imbalance between supply and demand of memory will put pressure on the overall semiconductor industry. Looking ahead to the second half of the year, the semiconductor market is expected to improve driven by data center and general economic recovery.
Post time: May-05-2023