Worldwide Semiconductor Foundry Market Grew 4.4 Percent in 2015, According to Final Results by Gartner

STAMFORD, Conn., April 12, 2016 --Breaking a three-year double-digit-growth streak, the worldwide semiconductor foundry market grew 4.4 percent in 2015 to achieve $48.8 billion in revenue, according to final results by Gartner, Inc.

"In 2015, semiconductor device market revenue declined due to excess IC inventory, poor demand for mobile products and PCs, and slowing tablet sales," said Samuel Wang, research vice president at Gartner. "The slowdown in the device market has driven semiconductor producers to be conservative in placing wafer orders to foundries. Foundry growth was only possible from the high wafer demand by Apple and the revenue conversion of a few integrated device manufacturers (IDMs) to foundries."

Among the top players, the leader, TSMC, grew 5.5 percent in 2015, driven by the success of 20 nm planar and 16 nm Fin field-effect transistor (FinFET) technologies serving the need of application processors and baseband modem chips (see Table 1). Globalfoundries moved into the No. 2 position with 9.6 percent of the market. The No. 3 position went to UMC with $4.5 billion revenue, representing 9.3 percent of the market.

Table 1
Top 10 Worldwide Semiconductor Foundries by Revenue (Millions of U.S. Dollars)

2015 Rank	2014 Rank	Vendor	2015 Revenue	2015 Market Share (%)	2014 Revenue	2015-2014 Growth (%)
1	1	TSMC1	26,566	54.3	25,175	5.5
2	3	Globalfoundries2	4,673	9.6	4,400	6.2
3	2	UMC3	4,561	9.3	4,621	-1.3
4	4	Samsung Electronics4	2,607	5.3	2,412	8.1
5	5	SMIC	2,229	4.6	1,970	13.1
6	6	Powerchip Technology5	985	2.0	917	7.4
7	10	TowerJazz	961	2.0	828	16.1
8	7	Fujitsu Semiconductor	845	1.7	653	29.4
9	9	Vanguard International	736	1.5	790	-6.9
10	13	Shanghai Huahong Grace Semiconductor	651	1.3	665	-2.0
		Top 10 for 2015	44,814	91.7	42,431	5.6
		Others	4,077	8.3	4,281	-7.0
		Total Market	48,891	100.0	46,812	4.4

¹ About 5% of TSMC's revenue is from nonwafer manufacturing
² Includes IBM foundry and IBM captive, but excludes the acquired IBM ASIC contribution of $332 million
³ About 2.5% of UMC’s revenue is from nonwafer manufacturing
⁴ Includes Samsung classic foundry revenue and Apple’s wafer business on 28 nm and 14 nm, but excludes Samsung’s ASIC business
⁵ Excludes $312 million DRAM
Note: Because of rounding, sums of numbers may differ from totals shown
Source: Gartner (April 2016)

Price competition in advanced process technologies in 2015 was exceptionally strong, not only on the 28 nm node, as more foundry suppliers have started the production volume of 28 nm polySiON technology, but also on 65 nm and 40 nm. In contrast to the highly utilized 200 mm fabs from fingerprint ID chips and power management ICs, the low 300 mm fab utilization rates at some large foundries have triggered their willingness to run more 0.18-micron wafers in the 300 mm fabs.

"On a quarterly basis, foundry revenue changed quarter to quarter in 2015. The normal seasonal pattern of a very strong second quarter was not obvious, while most foundries continued to revise their business outlook during each quarter's earnings release," said Mr. Wang. "The peak inventory level for the semiconductor industry continued to push out during 2015, from the second quarter to the third quarter, and through the rest of the year."

Additional information is provided in the Gartner report "Market Share: Semiconductor Foundry, Worldwide, 2015."

About Gartner

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