Leading edge leads the way in pure-play foundry growth

9th October 2015

IC Insights

Nat Bowers

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The total pure-play foundry market is forecast to grow 6.1% to $44.9bn in 2015. The entire increase in pure-play foundry sales is forecast to be due to sales of devices built using leading edge (less than 40nm) feature sizes. The <40nm pure-play foundry market is expected to increase 24% to $16.1bn in 2015 compared to $13.0bn in 2014 (see Figure 1, below). In contrast, pure-play foundry sales of ≥40nm devices are forecast to decline 2% to $28.8bn, based on findings presented in IC Insights’ September Update to the 2015 McClean Report.

Figure 1 - Leading edge leads the way in pure-play foundry growth

Figure 1 - Leading edge leads the way in pure-play foundry growth

Figure 2 shows sales of ≤45nm devices from the Big 4 pure-play foundries on a quarterly basis for 2014 and 2015. IC Insights forecasts that 63% of TSMC’s 2015 sales will be based on ICs built using ≤45nm technology. Furthermore, TSMC is forecast to have about $5.7bn in sales of ≤20nm devices in 2015 ($5.1bn from 20nm and about $0.6bn from 16nm devices). That would be 2.7 times more than the $2.1bn worth of ≤20nm product the company sold in 2014. The company began volume shipments of its 16nm devices in 3Q15 and stated: “The ramping of our 16nm will be very steep, even steeper than our 20nm.”

Figure 2 - Major pure-play foundries' ≤45nm revenue

Figure 2 - Major pure-play foundries' ≤45nm revenue

As shown, the portion of ≤45nm sales at GlobalFoundries is expected to decrease five percentage points from 2Q15 to 3Q15. This drop is due to the inclusion of IBM’s chip sales, much of which is large feature size RF devices, in GlobalFoundries’ sales figures beginning in 3Q15 (the acquisition was finalised in July of this year).

One-third of UMC’s total sales are forecast to come from ≤45nm technology in 2015 and SMIC is expected to sell only $363m worth of ≤45nm ICs in 2015, or only 2% of the level of TSMC’s ≤45nm sales forecast for this year.