Regarding the major foundries’ performances in 1Q20, TSMC ranks first in terms of revenue. Some of its 7nm process node capacities have been booked in advance by its clients, therefore providing a steady influx of orders for TSMC. Even with adjustments to some of its wafer starts, the demand from TSMC’s subsequent client orders is projected to fill the gaps in wafer starts, meaning the foundry will continue to maintain the maximum level of 7nm process node capacity utilization.

In terms of TSMC’s 12/16nm process nodes, although the possibility of potential adjustments in 12/16nm wafer starts may not be ruled out entirely, the magnitude of these changes is not expected to be significant, meaning the foundry may still maintain about 90% level of 12/16nm capacity utilization going forward. On the other hand, TSMC’s production capacities of mature process nodes and special technology are currently fulfilling the demands for 5G, IoT, and automotive products, which contribute to its steady revenue stream.

Samsung is continuing to increase its production capacity for 5G SoC AP, high resolution CIS, OLED-DDIC, and HPC products, while at the same time expanding its range of EUV applications and promoting its 8nm process node capacities, in an attempt to raise the share of revenues from advanced process node products in its total foundry revenue. However, the pandemic has made a serious impact on South Korea, whose domestic market demand may be diminished as a result. This is projected to affect Samsung’s 1Q20 revenue performance.

GlobalFoundries has been expanding its 5G, MRAM, and automotive product lineups with 22FDX and 12nm LP+ process nodes. The foundry has agreed to manufacture wafers at the New York fab it transferred to ON Semiconductor until the end of 2022, thus ensuring a steady revenue stream throughout the 2020-2022 period. But the total divestment of its Singapore fab to VIS is expected to have a greater direct impact on its 1Q20 revenue.

Owing to growing orders for its 22/28nm process node products, in addition to the new clients and product mixes from its new Japan-based fab, UMC is expected to see quarterly gains in its capacity utilization rate, in turn registering a minor QoQ increase in 1Q20 revenue. On the other hand, SMIC’s capacity utilization rate is sitting at near-maximum levels due to increasing demand in the domestic Chinese market for CIS, PMIC, fingerprint sensors, and embedded memory applications, subsequently contributing to the company’s 1Q20 revenue.

PSMC and VIS both profited from the increased demand for CIS and DDIC products and from their clients’ increased stock-up efforts. Also, VIS’ revenues will include those generated from its Singapore-based Fab 3E, originally purchased from GlobalFoundries. PSMC and VIS are expected to post increased YoY revenue in 1Q20. Owing to the pandemic’s impact, TowerJazz and Hua Hong Semiconductor may see lower client stock-up demands than previously expected. The two companies’ revenue performances may appear relatively conservative in 1Q20.

According to TrendForce, the foundry industry’s revenue in 1Q20 is estimated to increase by 30% YoY, which is meant to demonstrate an overall optimism for the semiconductor industry to make a recovery in 2020. However, as the pandemic multiplies across Europe and the United States, its effects will most certainly make a dent in the economy as well, in turn contracting the global market’s purchasing powers. The economic implications of the pandemic on foundry revenue may be increasingly likely to surface in 2Q20, serving as a test for the industry’s strategic capabilities regarding product planning and risk assessment.