Expected pure-play semiconductor foundry revenue of $5.6bn in Q409 will be up 53.7% from Q408, reports iSuppli, however, Q408 was the beginning of a sharp downturn in the industry with revenue falling to $3.7bn down from the $5.4bn of Q308.
"The strong year-over-year rise in pure-play foundry revenue in the fourth quarter paints a deceptively strong picture of industry growth," says Len Jelinek, director and chief analyst, semiconductor manufacturing, for iSuppli, "the reality is that the fourth quarter is bringing only a moderate expansion in revenue compared to the third quarter. Furthermore, foundries are noting a slowing of orders, indicating an underlying uncertainty in the market."
Global semiconductor foundry revenue in Q409 is set to rise by a 6% compared to Q309.
See also: 2009 could have been a lot worse, says iSuppli
Foundries are reporting weakness in their sales of semiconductors to the communications and computing segments, with the exception of netbook PCs, an area that is seeing some strength. The companies also note healthy orders in the consumer segment.
Foundries also are reporting downward pricing pressure at advanced semiconductor manufacturing process nodes, such as 65nm, as more suppliers enter this segment of the market. However, pricing for more mature semiconductor processes, such as 0.18-micron, is holding steady.
"In early 2009, when utilisation rates were low, foundries were willing to cut prices on mature semiconductor processes to fill their fabs," says Jelinek, "however, with utilisation having risen at the end of the year, companies no longer are willing to compromise on pricing for mature technologies."
Global pure-play semiconductor foundry utilisation is set to rise to 83% in Q409, up from 72% in Q109.
A positive indicator for the industry, is that inventories held by foundries remain in a healthy state of balance. This means that any increase in end demand will result in revenue increases for the foundry industry.
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