The dynamics within the global semiconductor industry are undergoing distinctive shifts as we approach 2024, despite an overall economic climate that has yet to demonstrate tangible signs of improvementA recent comprehensive analysis by TrendForce has uncovered a unique development trajectory for the semiconductor sector as it moves into the third quarter of 2024. In this period, we witness a confluence of factors such as the release of new smartphones and PCs in the second half of the year, which have prompted supply chain stakeholders to actively prepare and stock up on componentsCoupled with the persistent robust demand for High-Performance Computing (HPC) systems associated with AI server technology, this has led to a significant enhancement in overall wafer foundry capacity utilization compared to the previous quarterWithin this evolving industrial ecosystem, the cumulative revenue generated by the world’s top ten wafer foundry companies surged by 9.1%, hitting a remarkable total of $34.9 billion in Q3. Notably, this noteworthy performance can be attributed in part to the high value production of 3nm process technology, which has resumed operations post-pandemic, thereby establishing a new benchmark in the industry.

Looking ahead to Q4 of 2024, TrendForce anticipates that advancements in process technology will continue to bolster the revenues of the top ten foundries, albeit with a slight tapering in quarter-on-quarter growth rates

The operational performance within this market segment is expected to polarize, driven largely by the anticipated demand for flagship smartphones, AI chips, and the momentum supplied by 5nm and 3nm technologies heading into the year's endThe advanced CoWoS packaging is also poised to remain in high demandConversely, the market for mature processes (28nm and above) is riddled with ambiguity as terminal sales figures continue to be uncertain and as the industry approaches the traditional dip in sales that typically begins in the first quarter of 2025. Following the ample stocking in Q3 of 2024, the demand for peripheral IC components like TV SoCs, LDDI, and panel-related PMICs is expected to see a notable declineHowever, these factors may be offset by the last-minute purchasing surge from Chinese smartphone brands, bolstered by subsidies for trade-ins, which are likely to stimulate an unexpected spike in orders as the year draws to a close

• Rising Investment Sentiment in Memory Chips
• China's Storage, Photonics Tech Sees Major Advance
• Impact of Early Rate Cuts by the ECB
• Federal Reserve Cuts Rates by 25 Basis Points!
• New Signals Emerge in the Global Chip Market!

This environment suggests that capacity utilization for mature processes in Q4 may stabilize or experience slight growth compared to the preceding quarter.

TrendForce also indicates that there was no change in the revenue rankings among the top ten wafer foundries for Q3. TSMC (Taiwan Semiconductor Manufacturing Company) retained its dominant position with a nearly 65% market share, thanks to a thriving demand for flagship smartphones, AI GPUs, and new PC CPU architectures that drove significant increases in wafer shipment volumes and capacity utilizationIn fact, TSMC saw a remarkable 13% boost in revenue, reaching $23.53 billion this quarter.

Samsung Foundry held onto the second spot in terms of revenue

Despite securing some orders related to smartphones, the products from its major clients in advanced technology processes are nearing the end of their product life cyclesThe pressures of competition in mature processes have led to price reductions, causing Samsung to experience a revenue decline of 12.4%, resulting in a market share drop to 9.3%.

Ranked third, SMIC (Semiconductor Manufacturing International Corporation) achieved a revenue increase of 14.2% quarter-on-quarter, amounting to $2.2 billionAlthough there was no significant uptick in wafer shipment volumes during Q3, improvements were seen due to an optimized product mix and the ramp-up of new 12-inch capacity.

UMC (United Microelectronics Corporation), in fourth place, demonstrated enhancements in both wafer shipments and capacity utilization, leading to a revenue growth of 6.7% to $1.87 billion.

GlobalFoundries benefited from strong orders related to smartphones and new PC releases, resulting in increased wafer shipments and capacity utilization

Its revenue grew by 6.6%, reaching $1.74 billion, placing it in fifth position.

Consumer inventory replenishment has triggered urgent orders for peripheral components, thereby enhancing the capacity utilization rates of Tier 2 wafer foundries.

HuaHong Group climbed the ranks as it secured orders for IC components related to smartphones and new PC modelsThe demand for consumer stock replenishment also contributed to the increased capacity utilization of both HLMC and HHGrace, leading to a revenue growth of 12.8%, claiming a 2.2% market share and ranking sixth overall.

Tower Semiconductor, in seventh place, reported an increase of 5.6% in revenue, amounting to $371 million for Q3, benefiting from infrastructure orders for RF ICs and related technologies demanded by AI servers.

VIS ( Vanguard International Semiconductor) ranked eighth with a revenue growth of 6.9% to $366 million, experiencing increases in capacity utilization driven by LDDI components for consumer electronics and orders from the AI sector.

PSMC (Powerchip Semiconductor Manufacturing Corporation) saw steady increases in memory foundry workloads and responded to urgent component demands from smartphone manufacturers, achieving a revenue of $336 million for Q3 and placing ninth in the rankings.

Finally, Nexchip maintained its position at tenth place, reporting a Q3 revenue of $332 million, reflecting a quarter-on-quarter growth of approximately 10.7%.