Taiwanese semiconductor companies are expected to benefit both from increasing demand for 5G network development worldwide as well as the ongoing trade war between the United States and China, analysts said Sunday.
As countries around the world are speeding up their 5G network development, Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, is speeding up its 5-nanometer chip manufacturing process to meet growing demand, particularly from makers of 5G wireless devices, the analysts.
The company has estimated a higher-than-expected capital expenditure this year than its original estimate of between US$10 billion and US$11 billion, they said.
MediaTek Inc., the largest integrated circuit designer in Taiwan, meanwhile, also expressed optimism in the 5G market as global sales of 5G smartphones could reach 140 million in 2020.
With the expected higher demand, MediaTek’s 5G chipset shipments are likely to reach 22 million units in 2020, jumping to 87 million units in 2021, according to the analysts.
Meanwhile, Taiwanese companies are also expected to benefit as the tariff war between the U.S. and China continued to heat up as President Donald Trump made official Wednesday an additional 5 percent tariff on US$300 billion-worth of Chinese imports and set a collection date of Sept. 1.
To avoid being affected by the higher tariffs of 15 percent, many Chinese companies have been looking elsewhere to have their products manufactured, including Taiwan.
Thanks to the order transfer, Taipei-based radio frequency integrated circuit supplier RichWave Technology Corp. (立積) is expected to see a 20 percent increase revenue in the third quarter this year compared with Q2, the analysts said.
Integrated circuit designer eMemory Technology Inc. (力旺) said it is also making progress in its business cooperation in China, as it is currently helping its Chinese client on security monitoring product design.
A source at the Metal oxide semiconductor field-effect transistor (MOSFET) manufacturer, Excelliance MOS Co., Ltd., said there are many opportunities in China for Taiwanese chip makers.
China’s IC industry currently only has a 21 percent self-sufficiency rate, meaning that it has to depend largely on foreign imports for many of its key components and chips to sustain its operations, the source said.
(By Chang Chien-chung and Joseph Yeh)