Shortages Surface in NAND Flash

http://chipdesignmag.com/display.php?articleId=5164

By Mark LaPedus

Spot shortages - and possible price increases - for NAND flash have suddenly surfaced in the market amid recent production cuts by major memory suppliers.
The shortfall in NAND emerged this week, when solid-state drive (SSD) vendor OCZ Technology Group Inc. lowered its quarterly forecast. OCZ disclosed it could not obtain enough NAND parts for its SSDs.
Other OEMs are expected to see similar NAND shortages in the market, especially small- to mid-sized companies with no secure source of supply. On the other hand, Apple may be able to get an ample supply of parts.
The NAND shortfall is somewhat predictable. Micron, Samsung, SK Hynix and Toshiba have recently cut NAND production amid lackluster demand.
Besides supply for NAND, there are also some pricing issues for these parts. Prices for NAND hit $0.31/GB in June, but they went back up to $0.36/GB in August, according to Jim Handy, an analyst with Objective-Analysis, a research firm.
“We believe ASPs thus far in the quarter have been flattish versus the significant declines in 1H ‘12. Both 64-Gbit MLC and 32-Gbit MLC are declining flat to 5-7% thus far in the quarter,” added Vijay Rakesh, an analyst with Sterne Agee.
OCZ feels the pinch
Meanwhile, at OCZ, the shortfall of NAND impacted the company’s  Vertex and Agility line of SSDs. OCZ itself expects preliminary revenue for the second fiscal quarter of 2013 to be approximately $110 to $120 million, compared to the previously guided revenue range of $130 to $140 million. This preliminary revenue range compares to $113.6 million for the first fiscal quarter of 2013 and $78.5 million for the second fiscal quarter of 2012.
"Despite achieving bookings in excess of our expectations for our second fiscal quarter, we were not able to meet our previously stated revenue guidance due primarily to constraints in NAND flash supply," said Ryan Petersen, CEO of OCZ Technology.
“OCZ is not the only company that is affected by the supply shortages,” he said during a conference call. "While we believe that the situation will resolve itself, subject to market conditions, we plan to hasten our transition to new process nodes in order to help ease these supply constraints."
Hans Mosesmann, an analyst with Raymond James & Associates, said OCZ’s NAND shortfall involves select parts. “The shortages were primarily in 25nm MLC or consumer focused NAND, which OCZ partially resolved by using SLC or enterprise NAND at the expense of gross margins. Despite using SLC, the company depleted its inventory and expects to be 30-50% short on its NAND orders through November,” Mosesmann said.
OCZ blamed the problems on recent NAND production cuts at Micron, Samsung, SK Hynix and Toshiba. But OCZ may have also dropped the ball, as the company apparently failed to secure a steady source of NAND parts.
“The company's lack of a strategic NAND deal is clearly being negatively felt as volatility in the NAND market continues to challenge independent vendors, especially a vendor focused on a high-volume business through the channel,” said Alex Kurtz, an analyst with Sterne Agee.
“Looking forward, visibility remains challenging on the NAND front as OCZ believes the reported iPhone 5 launch is sapping supply out of the market and that transitioning to the Barefoot 3 controller, which uses a lower node flash with better availability, will also help address this issue,” Kurtz said.
The Barefoot 3 is a SSD controller, based on the SATA-2 interface. It was designed by Indilinx Co. Ltd. In 2011, OCZ acquired Indilinx, a fabless provider of flash controller semiconductors and firmware for SSDs.

ARL-Funded Research Leads to Serendipitous Discovery of Optical Scanning Method

Global IC Trading Group has this technology, DTEK, in-house.

http://www.militaryaerospace.com/news/2013/04/02/arl-funded-research-leads-to-serendipitous-discovery-of-optical-scanning-method.html

April 2, 2013

By Targeted News Service

The U.S. Army Research Laboratory issued the following news:
The U.S. Army Research Laboratory's (ARL), Army Research Office's (ARO) initial concept of exploring DNA as a tagging and tracking method has led to the discovery of an optical scanning technology that can identify counterfeit electronic components before they are integrated into Army materiel.
The technology also provides the capability to identify and track materiel in the absence of external tags or barcodes.
This timely discovery will help address a significant challenge within the Army and DoD: the presence of counterfeit electronic components in military equipment.
A 2011^'2012 investigation by the Senate Armed Services Committee (SASC) found overwhelming evidence that international counterfeiters are taking old, sub-standard electronic components and altering them to appear as new, brand-name parts that are then integrated into DoD munitions, aircrafts, sensors, and other electronic devices.

SASC chairman, Sen. Carl Levin, stated that the "flood of counterfeit parts, overwhelmingly from China, threatens national security, the safety of our troops, and American jobs."
Although the SASC uncovered the sources of many of these counterfeit parts, an ongoing challenge is to consistently and reliably identify these forgeries and prevent their integration into DoD and Army materiel.
The SASC released a report in May 2012 emphasizing this challenge by documenting "failures by defense contractors and DoD to report counterfeit parts and gaps in DoD's knowledge of the scope and impact of such parts on defense systems."
This investigation led to an amendment, signed by President Obama, to stop the integration of counterfeit electronic parts into DoD systems and to address weaknesses in the supply chain.
An ARL-ARO Small Business Innovation Research (SBIR) topic has led to a novel technology that will help address many of the challenges noted in the SASC report.
The SBIR topic, conceived by scientists from ARL-ARO and the Natick Soldier Research, Development and Engineering Center in 2007, called for a study of the properties of DNA to determine if this information-rich natural polymer could be used in a new barcoding system that would provide enhanced security relative to conventional tracking methods.
A California-based company, ChromoLogic, LLC, was contracted to explore this SBIR topic.
ChromoLogic developed a tag with a biomimetic barcode that can be aligned in the proper order and decoded by an optical reader, akin to how the sequence of a DNA molecule can be read.
This biomimetic tag and reader system has robust information-storage capabilities that are unambiguous and readily authenticated, with no reagent or material exchange between the tag and reader.
This technology will provide a capability that complements ongoing research led by the Edgewood Chemical and Biological Center, which focuses on embedding DNA in printed barcodes, which can be transferred to a reference test ticket to verify authentic military materiel.
Interestingly, as is often true for high-risk, high-payoff research, this project led to an unexpected discovery that may have an even greater impact than was initially conceived.
The research team, led by principal investigator Dr. Naresh Menon and project manager Leonard Nelson, discovered that the optical scanning technology developed to decode the biomimetic tag is capable of mapping the intrinsic surface of electronic components, providing a type of fingerprint to distinguish authentic or counterfeit circuits.
Nelson stated that when "illegitimate electronic components' surfaces are altered, the counterfeiters do it in a way that is very difficult for human observers to detect...believe it or not, the fake ones look better than the real ones."
Given that counterfeit electronic components are forged chiefly by altering their surface layers, this discovery provides a powerful method for screening integrated circuits based on their intrinsic surface patterns, which can be scanned in as little as one second.
ChromoLogic has developed this surface-scanning technology into the DTEK system, which provides quantitative optical inspection of integrated circuits.
Dr. Stephanie McElhinny, ARL-ARO program manager for the ChromoLogic project, noted that the development and use of this optical scanner for detecting surface fingerprints "is an incredible example that illustrates how research discoveries can guide a project to an outcome that would never have been predicted...and serves as a strong argument for the continued support of high-risk research to enable new Army capabilities."
The DTEK system recently began evaluation through multiple electronics manufacturers, and the technology has already been adopted by the NASA Jet Propulsion Laboratory and Boeing.
McElhinny and ARO Military Deputy Lt. Col. Timothy Warner attended a site demonstration of the DTEK system at Boeing's Huntington Beach location in 2012.
The ARL-ARO representatives were shown the quality assurance process at Boeing and the role that the DTEK system will play in authenticating circuits for use in DoD contracts.
According to Warner, the importance of this technology is evident "when one considers the implications of an illegitimate circuit making its way into Army materiel--it could cause a 10-fold reduction in service life, or worse--it could cause the failure of an aircraft or targeting system while in operation, putting lives at risk."
The DTEK system, used as part of a comprehensive counterfeit-mitigation process, may reduce the influx of forgeries into Army materiel and improve the reliability of mission-essential equipment used by the Soldier.
The DTEK optical scanning technology is also capable of identifying and tracking materiel in the absence of external tags or barcodes.
The research team is working with Picatinny Arsenal and the Aviation and Missile Research, Development and Engineering Center to develop a hand-held scanner that can be used for covert tracking and management of high-value Army commodities.

Global semiconductor inventories down 5% in Q4

http://www.totaltele.com/view.aspx?ID=480072

Intel cut its stockpiles by $585 million in the quarter, according to IHS.

Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc. The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%. "Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker. Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter. Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter. Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Intel cut its stockpiles by $585 million in the quarter, according to IHS.

Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc. The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%. "Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker. Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter. Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter. Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Intel cut its stockpiles by $585 million in the quarter, according to IHS. Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc. The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%. "Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker. Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter. Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter. Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Intel cut its stockpiles by $585 million in the quarter, according to IHS. Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc. The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%. "Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker. Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter. Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter. Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Intel cut its stockpiles by $585 million in the quarter, according to IHS. Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc. The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%. "Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker. Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter. Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter. Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc.

The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%.

"Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS.
No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker.

Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter.

Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter.

Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Texas Instruments Raises Lower End of Sales, Profit Forecasts

http://www.bloomberg.com/news/2013-03-07/texas-instruments-raises-low-end-of-forecasts-for-sales-profit.html

Texas Instruments Inc. (TXN), the largest maker of analog chips, raised the lower end of its forecasts for first-quarter sales and profit, as customers increase orders ahead of a projected rebound in electronics demand.

Earnings will be 28 cents to 32 cents a share on sales of $2.8 billion to $2.91 billion, the Dallas-based company said yesterday in a statement. On Jan. 22, Texas Instruments said profit would be 24 cents to 32 cents on revenue of $2.69 billion to $2.91 billion, and analysts on average predicted 29 cents and $2.81 billion, according to data compiled by Bloomberg.
Texas Instruments has thousands of customers across the electronics industry, from radar-equipment suppliers to microwave-oven makers, meaning its earnings are one of the broadest proxies for the health of the chip market. After running down inventories last year, some companies have resumed buying parts to ensure they aren’t caught short when demand returns, said Tore Svanberg, an analyst at Stifel Nicolaus & Co.
“Order rates are still improving, from obviously a low level,” said Svanberg, who recommends buying the shares. “The industrial market and especially automotive is showing some strength. We’re still very early in the process.”
Texas Instruments shares, which are up 14 percent this year, rose less than 1 percent to $35.20 at yesterday’s close in New York. Many stocks across the analog-chip industry have gained this year on optimism that orders will pick up starting in the second quarter.

Industrial Applications

“In general, the stronger demand environment has continued,” Texas Instruments Vice President Ron Slaymaker said on a conference call with analysts. “Quarter-to-date orders have been growing strongly.”
While demand remains weak for chips used in personal computers and phone-systems equipment, orders are increasing for chips used in industrial applications, Slaymaker said.
In the first quarter of 2012, profit was 22 cents a share on sales of $3.12 billion. Texas Instruments is one of the few companies that still give regular midquarter updates on their progress toward earnings targets.
The company increased its quarterly dividend by 33 percent and added $5 billion to its stock-repurchase program last month. Texas Instruments has an indicated dividend yield of 3.2 percent, according to data compiled by Bloomberg, among the highest in the semiconductor industry.
The chipmaker is in the process of exiting the market for digital chips used in smartphones and tablets, and said on Nov. 14 that it would cut 1,700 jobs as part of that shift. The staff reduction was estimated to pare expenses by about $450 million a year by the end of 2013, Texas Instruments said at the time.

RoHS 2 Creeps Up on the Industry

http://globalpurchasing.com/features/rohs-2-creeps-industry

Gary Nevison and the folks in the element14 community are doing their part to educate the electronics community about the new requirements of RoHS 2, an update to the European Restrictions on Hazardous Substances (RoHS), which took effect January 2. Element14 launched an updated e-book detailing the new requirements, and Nevison may soon be on the lecture circuit delivering that message to suppliers, customers, and others selling electronic components and finished products in Europe. Nevison is head of legislation for Premier Farnell, element14’s parent company, and he says the RoHS update is taking many in the industry by surprise.
“I think there are many areas of industry probably not prepared for this,” explains Nevison, pointing to new requirements for designating products with a CE mark, which means they conform to European standards, in particular.
The new requirements are part of a revision to the RoHS directive, known as the RoHS recast that began in 2010. The new requirements update the original 2006 directive, which banned the use of six substances—lead (Pb), mercury (Hg), hexavalent chromium (Cr (VI)), cadmium (Cd), polybrominated biphenyl flame retardants (PBB), and polybrominated biphenyl ether flame retardants—in eight categories of electrical and electronic equipment. RoHS 2, as it is known, broadens the scope of the directive to include additional products and product categories and makes RoHS compliance a CE directive, placing more data collection work on companies throughout the supply chain.
Some industry watchers say RoHS 2 has fallen off of many companies’ radar screens because it was a much bigger deal due to its newness in 2006. Quite simply, companies have been through it once, are largely familiar with the issue, and have procedures in place to address it. Further complicating the issue for American distributors is local legislation on counterfeit components and conflict minerals that is drawing more immediate attention. But Nevison and others caution against putting RoHS 2 on the back burner as environmental concerns become more acute worldwide and the regulatory climate heats up.
“Make no mistake about it, the authorities will be on this. They will come to check you for these technical files,” Nevison says, pointing to the need for documentation that products comply with European Union directives. He adds that each European state retains the responsibility for enforcing the rules under RoHS 2. “These are the facts. It’s getting more stringent rather than the other way around.”
More Products, More Documentation
Identifying products with a CE mark, which stands for Conformité Européenne (or European Conformity), ensures that they comply with EU regulations. The CE Mark directive places more data collection work on distributors and importers as they seek to verify RoHS compliance, Nevison explains.
“The main impact on industry is the inclusion of RoHS as a CE directive,” says Nevison. “[Companies] need to supply lots and lots of new documentation. The CE Mark is the biggest challenge to us at this point in time.”
In most cases, manufacturers are responsible for documentation and CE Mark designation, but in some instances the responsibility falls to the distributor or importer—especially when the distributor is selling the product under its own brand. The issue is further complicated because the CE Mark now applies to low-cost development boards, which is a sticking point for many manufacturers.
“I think some companies in all honesty didn’t think they needed to comply, but they do,” says Nevison, pointing to differing views over how development boards or kits are classified. “I think what deceives people is that these small, open PCBs don’t look like a piece of finished equipment. But as soon as they’re put in a PC to make them work, if you like, they are classed as finished equipment.”
Development boards that were already on the market before January 2, 2013, do not need to be remarked. RoHS 2 applies to any development boards or kits placed on the market after that date. Nevison says Premier Farnell has been in touch with all of its development kit suppliers to determine their compliance, to varying degrees of success.
“Some say they are in compliance, some say they’re working on it, and some haven’t done anything,” Nevison explains, adding that the issue may lead to distributors dropping certain products.
The other key issue is the broadened scope of the directive itself. RoHS 2 now includes products that depend on electric currents or electromagnetic fields for at least one of their functions. Previously, the directive applied only to products that depended on electric currents or electromagnetic fields to work properly. This widens the field of covered products. Nevison points to two examples: a gas stove with an electric clock and a gas lawnmower with an electric ignition, neither of which was covered under RoHS 1. The gas stove is in scope as of January 2, and the lawnmower will be in scope as of July 2019.
“So it will capture some different products,” Nevison explains. “And it’s worth saying there are lots and lots of exclusions this time. Those will be reviewed by July 2014, and they may even be extended.”
Nonetheless, RoHS 2 has a number of phase-in dates for new product categories. Medical devices and monitoring and control equipment must be in compliance after July 2014, with in vitro diagnostics coming into scope in 2016 and industrial monitoring and control instruments in July 2017. What’s more, RoHS 2 adds an eleventh category in July 2019 when all electrical and electronic equipment not captured in categories 1 to 10 of the directive come into scope.
Nevison emphasizes that revisions are ongoing, noting that the commission overseeing the RoHS directive plans to review more substances next year while also reviewing whether or not further exclusions should be granted.
Robin Gray, chief operating officer for the Electronic Components Industry Association, which represents manufacturers, distributors, and independent representatives in the electronics industry, says the modifications to the RoHS directive are part of a larger trend toward increased regulation worldwide. He points to pending RoHS legislation in China, new U.S. rules surrounding conflict minerals sourcing, varying state-level bans on certain chemicals in the United States, and the simmering concern over the supply of rare earth minerals commonly used in electronics equipment.
“I think the industry’s going to see more and more regulation—environmentally or otherwise,” says Gray. “The other issue is that so much of electronics uses rare earth minerals, and the supply of that is relatively limited—and some very limited. If you’re going to ban certain metals or certain chemicals, how viable are certain components for the long term? You’ve got to find new technologies, processes, or chemical formulas, or you’ve got to be willing to make a trade off. I think this is only going to become more of an issue.”

DRAM contract prices set to continue rising

http://www.digitimes.com/news/a20130128PD217.html

With some DRAM vendors reportedly quoting their 4GB DDR3 modules at more than US$20, higher than the current contract price level, contract prices for commodity memory are set to rise through February, according to industry sources.

Contract quotes for 4GB DDR3 modules came at between US$17 and US$17.50 in the first half of January, DRAMeXchange data shows. A combination of supply-side factors, such as a cutback in production of PC DRAM and more capacity allocated for mobile DRAM and server-use memory, lifted the early January quotes by almost 10%.

DRAM contract prices will continue their upward trend in February, driven mainly by the supply side, the sources indicated. Thanks to the price rally, suppliers that remain in the red will have a good chance of returning to profitability in 2013, the sources believe.

Inotera Memories, for instance, is expected to swing to profits in the second quarter of 2013, the sources said. Inotera reported net losses of NT$3.72 billion (US$128 million) for fourth-quarter 2012, which marked the 12th straight quarterly loss for the company.

Inotera has revealed plans to shift a majority of its total wafer starts to 30nm process technology by April, and the ramp-up will help improve company cost structure.

Fellow DRAM firm Nanya Technology recently remarked that the company's revised partnership with Micron Technology will help significantly reduce its R&D expenses. The firm is also looking to complete its technology transition to a 30nm process by the end of the third quarter to further lower its manufacturing cost.

Nanya is set to gradually be phased out from the commodity DRAM chip market with plans to discontinue supplying commodity chips to clients by mid-2013., the firm disclosed.

Nanya generated net losses of NT$8.88 billion in the fourth quarter of 2012 - also the 12th straight quarterly loss for the company.

Semiconductor inventory reaches record levels

Revenues to decline in Q1, rebound expected by Q3

http://news.techeye.net/chips/semiconductor-inventory-reaches-record-levels

 

Chip inventories reached record highs near the end of 2012, and according to IHS iSuppli, semiconductor revenue will decline in Q1, prompting new concerns about the state of the market.
Overall semiconductor revenue is expected to slide three percent between January and March 2013, on top of a 0.7 percent decline in Q4 2012. What's more, inventory reached record levels in Q3 2012, amounting to 49.3 percent of revenue, more than at any point since Q1 2006. IHS iSuppli believes the uncomfortably high level of inventory points to the failure of key demand drivers to materialise.
The PC market remains slow and hopes of a Windows 8 renaissance have turned into a nightmare. Bellwether Intel saw its revenue drop three percent in Q4, with profit tumbling 27 percent, and the trend is set to continue. AMD is expected to announce its earnings Tuesday afternoon and more gloom is expected across the board. The only bright spot in an otherwise weak market is TSMC, which quickly rebounded after posting the lowest revenues in two years a year ago. TSMC now expects to see huge demand for 28nm products in 2013 and many observers point to a possible deal with Apple.
In addition, TSMC plans to invest $9 billion in capital expenditure in 2013, and it will likely spend even more in 2014, as it moves to ramp up 20nm production. However, Intel's plans to increase capital spending to $13 billion, up $2 billion over 2012 levels, have not been welcomed by analysts and investors. Unlike TSMC, Intel is not investing to increase capacity in the short term, it is making a strategic bet on 450mm wafer technology, which promises to deliver significantly cheaper chips compared to existing 300mm wafers. However, 450mm plants are still years away.
TSMC's apparent success has a lot to do with high demand for smartphones and tablets, which are slowly eating into the traditional PC market. Semiconductor shipments for the wireless segment were expected to climb around four percent in 2012 and positive trends were visible in analog, logic and NAND components. However, the mobile boom can't last forever, and we are already hearing talk of "smartphone fatigue" and "peak Apple".
IHS iSuppli estimates the first quarter of 2013 will see growth in industrial and automotive electronics and other semiconductor markets will eventually overcome the seasonal decline, so a rebound is expected in the second and third quarters.
Semiconductor revenue could grow by four percent in the second, and nine percent in the third quarter. However, the assumptions are based on a wider economic recovery, which is anything but certain at this point. If demand evaporates, semiconductor suppliers could find themselves hit by an oversupply situation, leading to more inventory write-downs throughout the year.


Read more: http://news.techeye.net/chips/semiconductor-inventory-reaches-record-levels#ixzz2IkDvMFYT