TAIPEI, Taiwan Contract chip makers Taiwan Semiconductor Manufacturing Co. and United Microelectronics Corp. confirmed double-digit percentage declines in their annual sales on Wednesday (Jan. 9), capping a year that pushed UMC into the red and saw TSMC nearly follow suit.
But while things look to be improving at TSMC, with December sales up 6 percent over November, the opposite is true at UMC, where sales dipped 8 percent.
Overall, TSMC's sales declined 24 percent last year, to $3.6 billion. At UMC, sales dropped 38 percent, to $1.8 billion. Earlier, the company predicted its 2001 loss would be $93 million. TSMC expects a profit of $378 million.
UMC was much harder hit by the downturn, as its top customers in communications severely cut back on orders. The company is already feeling the pinch of the traditional slow season, evidenced by the December drop, and it has acknowledged that the first quarter will probably be a little wor se than the fourth.
TSMC, on the other hand, saw sales steadily rise through the fourth quarter, buoyed by strong demand from Nvidia Corp. and their graphics chips used in Microsoft's Xbox. So far, TSMC has proven more successful than its rivals in selling the more profitable process geometries below 0.25 micron; enough so that CEO Morris Chang believes revenue this quarter will be flat or slightly better.
Currently, TSMC is estimated to be running at about 47 percent utilization, while UMC is at 43 percent and Chartered Semiconductor in Singapore is below 25 percent.