As per the industry reports, TSMC’s labs are running at the full capacity due to 5G modem orders. This led the company to conclude that the demand for 5G smartphones will reach 300 million next year, and the current industry consensus is not that bad either, as it is about 160 million.
According to IDC (International Data Corporation), shipments of 5G mobile phones will be 6.7 million units this year. From the forecast of TSMC, shipments of 5G mobile phones will increase by nearly 50 times next year.
As a chip supplier, TSMC has an absolute reference value based on the number of orders. In July this year, TSMC also announced the recruitment of 3,000 engineers to cope with the growth of demand for 7nm technology and 5G chips.
TSMC released three significant points
TSMC held the third quarter of the law conference yesterday (17th October 2019), and announced three significant events in one breath:
- The operating surface is optimistic that the 5G mobile phone penetration rate is 15% better than expected.
- This year’s capital expenditure is also raised to a historical high of 14-15 billion US dollars.
- Sun Youwen, senior director of the Corporate Information Division, who served for 17 years, retired at the end of the year. This year, with the founder Zhang Zhongmou, the new TSMC era has officially launched.
A little window of opportunity for Samsung
TSMC’s performance in the second half of 2019 is expected to hit a new high. It will be the primary growth momentum for 5G technologies, Wei Zhejia, president of TSMC.
According to industry sources, TSMC is more confident than others about 5G phone shipments in 2020 as the firm is optimistic that the worldwide shipments of 5G phones could reach 300 million in the coming year, a lot higher than most market leaders expect.
Predicting from TSMC’s growing capacity utilization rates, memory chip vendors have asked their controller suppliers to make the inventory in advance to refrain from production jams at TSMC. As per the industry sources, memory chip vendors may turn to Samsung Foundry, looking for advanced node manufacturing support, who is allegedly keen to build up its EUV production capacity.
Huawei in the race
Notably, what prevents most consumers from following the 5G trend today is the high price and relatively intensive signal coverage. However, on the way to the more cost-effective equipment, operators and governments are also increasing the construction of base stations. In the domestic market, Huawei expects to issue 80 million 5G mobile phones next year. Other manufacturers are also catching up quickly.
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