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OmniVision Technologies, Inc. Message Board

  • erickarr Jan 8, 2009 12:36 PM Flag

    Just released news mentions OVTI--MUST READ

    EE Times
    (01/08/2009 10:42 AM EST)

    SAN JOSE, Calif. -- It's going from bad to worse among Taiwan's leading foundries: Taiwan Semiconductor Manufacturing Co. Ltd.'s business is worse than expected, while United Microelectronics Corp. sees a major sales decline.

    TSMC's ''customers are cutting orders, driving down utilization rates to historical lows, according to a report from FBR Capital Markets. ''We believe there is increased probability that utilization rates at TSMC could even decline to below 40 percent in 1Q '09, potentially setting a new historical low compared to the last historical low of 41 percent that occurred in 2Q '01.''

    This is worse than previously expected. In a report released in December, FBR said it expected TSMC's capacity utilization, which had been significantly above 90 percent in the third quarter, to fall to the low 60 percent or high 50 percent range in Q4 and to 45 percent or lower this quarter. In a separate report, FBR said it expected UMC's utilization rate to about 40 percent in the first quarter of 2009.

    At present, TSMC's wafer starts are falling--and fast. ''Although TSMC lowered 4Q '08 revenue guidance in early December, prompting us to lower our (calendar 2009) estimates, checks this week in Taiwan suggest continued cutbacks in wafer starts, so far, in early January,'' according to FBR.

    ''Specifically, we now expect wafer shipments to have declined by as much as 35-38 percent quarter-over-quarter in 4Q '08 (verses previous expectations of down 30-35 percent), and we now expect 1Q '09 wafer shipments to be down by as much as 30 percent quarter-over-quarter (verses previous expectations of 25 percent),'' according to the report.

    ''This is expected to seriously test TSMC's ability to remain above break-even point in 1H '09,'' according to the report. ''Our checks also indicate that, although the wafer start cuts are being done by customers across all different end markets, the wireline customer orders (specifically Altera) have remained relatively stable while customers like CSR, Himax, Broadcom, Freescale, Marvel, Omnivision, Sunplus, TI, and Zoran have had the most cuts.''

    FBR is cutting its 2008/2009 EPS estimates for TSMC again, lowering them from the previous $0.62/$0.20 (or NT$3.88/1.32) to $0.62/$0.07 (or NT$3.85/0.47).

    Business is also bad at Taiwan rival UMC. UMC's December sales were NT$4.609 billion ($139 million), down 45.54 percent from a year earlier and 23.49 percent lower than November's level.

    For 2008, UMC's sales were NT$92.5 billion ($2.789 billion), down 13.34 percent from a year earlier.

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