Many Western firms are reviewing their provide chains and reliance on China as a producing base, with Washington stepping up curbs particularly geared toward hobbling Beijing’s chip ambitions and slowing its technological and army advances.
Asked on an earnings name about US and European chip designers shifting orders away from Chinese factories, UMC co-president Jason Wang mentioned their clients had been beginning to “evaluate their supply chain resilience”.
UMC may gain advantage from that, given the corporate makes chips in Taiwan, China, Singapore and Japan, Wang added.
“We are seeing some customers move their products to other locations outside of China, but at the same time we also see some customers asking to take advantage of the China gap that creates,” he mentioned, with out naming the businesses.
Global tech demand has slumped in latest months as hovering inflation, rising rates of interest and a dark world financial outlook have led customers and companies to tighten spending.
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UMC, whose shoppers embrace US firm Qualcomm Inc and Germany’s Infineon, reported a 14.5% year-on-year fall in first-quarter income to T$54.2 billion ($1.77 billion), down 20.1% from the earlier quarter with wafer shipments dropping 17.5% quarter-on-quarter. “2023 will be a challenging year,” Wang mentioned. “The recovery will be much slower than we anticipated.”
However, the corporate stored its steerage for capital spending this 12 months of $3 billion, in contrast with $2.7 billion for final 12 months, and mentioned it noticed robust demand from automotive chips pushed by electrical automobiles and autonomous driving.
Bigger Taiwanese rival TSMC, the world’s largest contract chipmaker, final week reported a shock 2% rise in first-quarter revenue however forecast a 16% plunge in gross sales for the second quarter amid a listing glut and as a weakening world economic system has clouded the demand outlook.
Source: economictimes.indiatimes.com