The semicondustor market in 3Q21 is red hot with total revenue of the global top 10 IC design (fabless) companies reaching US$33.7 billion or 45% growth YoY, according to TrendForce’s latest investigations. In addition to the Taiwanese companies MediaTek, Novatek, and Realtek already on the list, Himax comes in at number ten, bringing the total number of Taiwanese companies on the top 10 list to 4.

Qualcomm has been buoyed by continuing robust demand for 5G mobile phones form major mobile phone manufacturers with further revenue growth from its processor and radio frequency front end (RFFE) departments. Qualcomm’s IoT department benefited from strong demand in the consumer electronics, edge networking, and industrial sectors, posting revenue growth of 66% YoY, highest among Qualcomm departments. In turn, this drove Qualcomm’s total 3Q21 revenue to US$7.7 billion, 56% growth YoY, and ranking first in the world.

Second ranked NVidia, is still benefiting from gaming graphics card and data center revenue as the annual revenue growth for these two primary product departments reached 53% and 48%, respectively. In addition, professional design visualization solutions only accounted for 8% of total revenue. However, due to enduringly strong demand for mining and customers actively deploying the RTX series of high-performance graphics cards, NVidia’s product department revenue grew 148% YoY with overall revenue increasing by 55% to US$6.6 billion.

Third ranked Broadcom’s main revenue stream came from their network chip, broadband communication chip and storage and bridge chip businesses. Driven by post-COVID hybrid working models, companies are accelerating migration to the cloud, increasing demand for Broadcom chips, and driving revenue growth to US$5.4 billion or 17% YoY. AMD’s Ryzen, Radeon, and EPYC series of products in the fields of games, data centers, and servers performed well, driving total revenue to US$4.3 billion, 54% growth YoY, and fifth place overall.

In terms of Taiwanese companies, MediaTek continues to expand its global 5G rollout and, benefiting from optimization of product portfolio composition, product line specification enhancement, increase in sales volume, increases in pricing, and other factors, revenue of MediaTek’s mobile phone product line increased 72% YoY. Annual revenue of other product lines also posted double digit growth with total revenue in the 3Q21 reaching US$4.7 billion or 43% YoY, a fourth place ranking. Novatek continues to focus on its two primary product lines of system-on-chip and panel driver chips. The proportion of its OLED panel driver chip shipments has increased, product ASP has risen, and shipments have been smooth with 3Q21 revenue reaching US$1.4 billion or 84% YoY. In addition, Realtek’s revenue surpassed Xilinx to take the eighth position due to higher priced Netcom chips in 3Q21. Himax also saw significant growth in its three main product lines of TVs, monitors, and notebooks due to large-size driver chips. Revenue from large-size driver chips increased 111% YoY, driving total revenue to exceed the US$400 million mark, a 75% increase, and enough to squeeze onto this year’s ranking.

Overall, 3Q21 revenue for major IC design (fabless) companies has generally reached historic levels. Rankings for the top 7 companies remained the same as in 2Q21 with change coming in ranks 8 to 10. Looking forward to 4Q21, TrendForce believes Taiwanese IC design (fabless) companies will generally lean conservative. In addition to the electronics industry moving into the traditional off-season, a slowing of demand for consumer applications and customer-end materials supply issues reducing procurement will make continued revenue growth a challenge. In addition to consumer electronic products, global industry leaders are focused on the positive development of server and data center products to maintain an expected revenue growth trend.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com

Due to material shortages caused by insufficient semiconductor supply, to date, power management IC (PMIC) prices remain on an upward trend, according to TrendForce’s latest investigations. Average selling price (ASP) for 1H22 is forecast to increase by nearly 10%, reaching a record six year high.

In terms of the global supply chain, in addition to the production capacity of major IDM manufacturers including TI, Infineon, ADI, STMicroelectronics, NXP, ON Semiconductor, Renesas, Microchip, ROHM (Maxim has been acquired by ADI and Dialog by Renesas), IC design houses such as Qualcomm and MediaTek (MTK) have obtained a certain level of production capacity from foundries. Of these, TI is in a leadership position and the aforementioned companies possess a combined market share of over 80%.

In terms of product structure, unrelenting demand from the consumer electronics, telecommunications, industrial control systems, and automotive end-user sectors and product innovation driven by industrial transformation will push a dramatic increase in global market demand for PMICs. The largest application for PMICs is consumer electronic products and there are near term rumblings in demand for notebooks, Chromebooks, smartphones, and televisions. In addition, restocking impetus for a small number of structurally simple items such as low drop-out regulators (LDO) has encountered a real slowdown. However, since the demand placed on PMICs by electronic products is a structural increase, certain models are still experiencing shortages. Qualcomm and MTK are limited by a shortage of mature production capacity on the foundry end, even resulting in a tightening of inventory for PMICs earmarked for self-use.

Furthermore, recovery in the automotive market and rapid growth in electric vehicles, automotive electronics, and advanced driver-assistance systems (ADAS) have increased demand in power source control and management and charging technology. In addition, automotive-use ICs are required to pass a number of inspections and must guarantee consistency and a zero failure rate. Currently, IDM companies’ automotive IC order backlog stretches until the end of 2022. Due to factors such as production running at full capacity and a shortage of raw materials, PMIC suppliers have currently announced longer lead times with consumer electronic IC lead times increasing to 12~26 weeks, automotive IC lead times reaching 40~52 weeks, and a cessation of orders for certain exclusive production models.

TrendForce expects 4Q21 demand for PMICs to remain strong with shortages in overall production capacity. Led by IDM companies, PMIC pricing will remain high. Despite variables related to the pandemic and the difficulties of greatly increasing 8 inch wafer production capacity, TI’s new fab RFAB2 will begin mass production in 2H22. In addition, due to the plans of foundries to carry forward a portion of 8 inch wafer PMIC manufacturing to 12 inch, there is a high likelihood of a moderation in PMIC shortages. However, close attention must still be paid to changes in future market supply.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com

In view of the ongoing production capacity shortage in the semiconductor industry and the resultant price hike of chips, revenue of the top 10 IC design companies for 2Q21 reached US$29.8 billion, a 60.8% YoY increase, according to TrendForce‘s latest investigations. In particular, Taiwanese companies put up remarkable performances during this period, with both MediaTek and Novatek posting YoY growths of more than 95%. AMD, on the other hand, experienced a nearly 100% YoY revenue growth, the highest among the top 10.

TrendForce indicates that the ranking of the top five companies for 2Q21 remained unchanged from the previous quarter, although there were major changes in the 6th to 10th spots. More specifically, after finalizing its acquisition of Inphi, Marvell experienced a major revenue growth and leapfrogged Xilinx and Realtek in the rankings from 9th place in 1Q21 to 7th place in 2Q21.

Thanks to strong demand for major smartphone brands’ flagship and high-end 5G handsets, revenue leader Qualcomm’s processor and RF front-end businesses underwent remarkable growths, while its IoT business also benefitted from WFH and distance learning demands generated by the COVID-19 pandemic. Qualcomm’s revenue from its IoT business reached nearly US$1.4 billion, making IoT one of the major growth drivers for the company. For 2Q21, Qualcomm’s revenue reached US$6.47 billion, a 70.0% YoY increase. On the other hand, Nvidia’s revenues from gaming graphics cards and data center solutions each grew by 91.1% YoY and 46% YoY, respectively, in 2Q21. Strong demand from cryptocurrency miners for Nvidia’s high-end gaming graphics cards, along with the data center segment’s demand for Nvidia’s HPC products, propelled the company’s revenue for 2Q21 to US$5.84 billion, a 68.8% YoY growth, and secured the second place for Nvidia on the top 10 list.

Broadcom, which took third place on the top 10, attributed most of its revenue to wired connectivity and wireless products. Regarding wired connectivity products, the continued build-out of 5G base stations worldwide resulted in increasing demand for Broadcom’s high-speed Ethernet controller ICs, whereas for wireless products, the release of certain high-end 5G smartphones also created high demand for Broadcom’s Wi-Fi 6E chips. Similarly, Broadcom’s broadband and industrial solutions businesses both underwent double-digit growths in 2Q21, thereby driving the company’s revenue for 2Q21 to US$4.95 billion, a 19.2% YoY growth. Turning to AMD, the company’s revenue for 2Q21 reached US$3.85 billion, a staggering 99.3% YoY increase, owing to the following: first, the bullish gaming console market; second, massive earnings growths from enterprise, embedded, and semi-custom solutions; third, increased client adoption of AMD’s server CPUs (it should be noted that AMD’s server processor business grew by 183% YoY in 2Q21). AMD took fifth place in the top 10 list for 2Q21.

Regarding Taiwanese companies, MediaTek was able to sustain the momentum it gained in 1Q21 throughout 2Q21. MediaTek’s smartphone chip business, which generated the bulk of the company’s revenue, registered a 143% growth in 2Q21. At the same time, its revenues from other businesses also saw an overall double-digit growth. Hence, MediaTek posted a revenue of US$4.49 billion for 2Q21, a 98.8% YoY growth, and reached fourth place on the list. Finally, Novatek’s SoCs and display driver ICs both performed well in the market primarily due to its close partnerships with major foundries, including TSMC, UMC, and VIS. Revenue from display driver ICs, which had traditionally been Novatek’s primary revenue source, grew by 81% YoY in 2Q21.

Certain rumors in the end-devices markets indicate that demand will likely undergo a slowdown in 3Q21 and lead to decreased orders for certain components. However, given that foundries’ newly installed wafer capacities have yet to kick off mass production, the ongoing chip shortage is expected to persist for now. In addition, as some IC design companies’ client orders still remain unfulfilled, these companies’ revenues will likely experience further growths in 2H21, albeit to a relatively limited extent. It should also be pointed out that Marvell is expected to benefit from Inphi’s earnings for the next two quarters and increase its own revenue by more than 50% YoY in 2H21. Even so, Novatek’s sixth-place ranking is unlikely to be threatened by Marvell in the short run since Novatek will continue to benefit from the ongoing chip shortage and price hikes for the time being.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com

While foundry capacities remained tight, prompting IC design companies to compete over limited foundry capacities in order to fulfill rising demand for various end devices, the top 10 IC designe (fabless) companies posted remarkable revenues in 1Q21, according to TrendForce’s latest investigations. In particular, thanks to the global mining craze brought about by the cryptocurrency market, Nvidia was able to surpass Broadcom in revenue and take the second spot among the top 10. On the other hand, fifth-ranked AMD scored a staggering YoY growth of 92.9%, which is the highest % increase on the top 10 list.

Market leader Qualcomm saw growths in its smartphone, RF front end, IoT, and automotive departments in 1Q21, during which it posted a revenue of US$6.28 billion, a 53.2% increase YoY, placing Qualcomm firmly in the number one spot. Coming in second place is Nvidia, which overtook Broadcom with $5.17 billion in revenue. Nvidia’s revenue performance can primarily be attributed to massive gaming graphics card demand generated by the cryptocurrency market and the stay-at-home economy. In addition, Nvidia’s Cloud & Data Center business also saw positive growths in 1Q21, thereby contributing to its revenue for the quarter as well.

Broadcom, ranked third on the top 10 list, posted a $4.49 billion revenue in 1Q21. Broadcom’s performance took place on the back of the bullish broadband telecom market, with growths in passive fiber optics and wired networking for data transmission. AMD, on the other hand, continued to benefit from the stay-at-home economy and other such market demands, in addition to its growing foothold in the server market. The company experienced increasing market shares and led its competitors with an impressive 92.9% YoY increase in revenue, the highest on the top 10 list. It should be pointed out that the extreme volatility of the cryptocurrency market, as well as the strict surveillance policies imposed on cryptocurrency trading by several countries, may introduce uncertainties in the future of gaming graphics card revenue for both Nvidia and AMD.

Regarding the performance of Taiwanese IC design companies, MediaTek’s smartphone business unit registered a remarkable 149% YoY growth in revenue mainly on account of high demand from Chinese smartphone brands, which were particularly aggressive in seizing Huawei’s former market share. Furthermore, as Qualcomm’s recent performance in the entry-level and mid-range smartphone markets remained relatively lackluster, MediaTek therefore aimed to fulfill demand from its smartphone clients as its chief goal on a macro level. As a result, MediaTek’s revenue for 1Q21 reached about $3.81 billion, an 88.4% YoY increase, placing the company in the fourth spot.

Novatek derived its performance from high component demand from manufacturers of IT products, TVs, and smartphones. In view of the current shortage of foundry capacity and rising prices of foundry services, Novatek has been able to maintain a stable supply of components via increased prices due to its longstanding, stable, and flexible strategic relationships with Taiwanese foundries (UMC, VIS, and TSMC), China-based Nexchip, and Korea-based Samsung LSI. Hence, Novatek leapfrogged both Marvell and Xilinx for the sixth place while increasing its revenue for 1Q21 by 59.4% YoY.

On the whole, the second wave of the COVID-19 pandemic in India, which has resulted in decreased production targets for Chinese smartphone brands, is not expected to drastically affect IC design companies’ component demand in 3Q21 because of the following factors: First, price hikes of foundry services have already been reflected in chip prices; secondly, market demand for devices remains high; and finally, Chinese smartphone brands still need to maintain a safe level component inventory, as they have yet to resolve the discrepancies among their various materials’ sufficiency levels.

Incidentally, although some expect that the recent spread of COVID-19 among KYEC employees may impact the procurement activities of IC designers that are part of KYEC’s clientele, TrendForce’s investigations of financial reports from various companies in April and May indicate that infections in KYEC facilities will unlikely result in major impacts on the revenues of IC designers in 2Q21.

For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com

As infections among employees from semiconductor backend testing leader KYEC make news headlines, the company suspended operations for two days and undertook facility-wide disinfections starting on June 4, although at the moment KYEC’s facility has yet to resume operations at full capacity. In the vicinity of KYEC are packaging and testing operator Greatek and networking device manufacturer Accton, both of which have since been affected by the spread of the disease.

Not only have the confirmed cases in KYEC generated worries about possible disruptions to the semiconductor supply chain, but the semiconductor industry is also anxious about whether continued infections will spread to other semiconductor companies.

As a leading chip tester (as well as the 8^th largest IC package and testing companies globally), if KYEC were to halt its operations altogether due to the continued spread of COVID-19 infections, the semiconductor supply chain would be considerably impaired as a result. Not only would upstream clients (including fabless companies, IDMs, and foundries) have their schedules disrupted, but lead times of downstream end-products will be prolonged as well, causing far-reaching impacts throughout the entire semiconductor industry.

According to KYEC’s publicly disclosed information, the distribution of its clientele is as follows: fabless companies (76%), IDMs (22%), and foundries (2%). In particular, of the 50 largest semiconductor companies globally, more than 30 currently make use of KYEC’s testing services.

According to TrendForce’s latest investigations, the packaging and testing industry has been impacted in the short run by KYEC’s two-day suspension and low-capacity operation resumptions successively. As such, MediaTek, Novatek, and STMicroelectronics, which are major clients of KYEC, are all notably experiencing impacts from the spread of the pandemic within KYEC’s ranks.

Although the above companies have already transferred some of their orders to ASE, Sigurd, and ChipMOS to make up for disruptions in KYEC’s operations, these orders are too numerous to be fulfilled completely at the present. Therefore, the tight capacity of chip testing services is expected to intensify going forward.

（Cover image source: Pixabay）