China-based Maxscend Microelectronics, dedicated to supplying RF frontend chips such as RF switches and low-noise amplifiers, is set to kick off trial production of SAW (surface acoustic wave) filters as a new offering later in 2022, according to industry sources.
The production will proceed at its subsidiary Wuxi Xinzhuo Semiconductor, which has set up SAW filter wafer fabrication and RF module packaging lines at a cost of CNY3.5 billion (US$519.28 million) and will enter equipment installation and calibration stage in the first half of the year, the sources said.
Constant 5G communication technology advancement has fast grown the RF frontend market, which, coupled with China's production localization efforts, has significantly boosted Maxscend's shipments. As of the end of 2021, the company's shipments of RF frontend chips and modules had amounted to 26 billion units, enabling its annual revenues and profits to grow for three consecutive years in 2019-2021. Its first-quarter 2022 sales rose 12.43% on year to CNY1.33 billion.
After its new product line SAW filters enter volume production in the third quarter of the year, Maxscend's revenue and profit performances are expected to improve further, given strong market growth potential for such filters, the sources said.
To further strengthen its competitiveness, Maxscend is actively moving to operate on a fab-lite model, under which production with a higher degree of standardization will be outsourced to manufacturing partners while specialty production process for some key products will be carried out in house, the sources continued.
Handset and router are now the two biggest application outlets for RF frontend chips, and Maxscend has entered the supply chains of Samsung Electronics and all major Chinese handset vendors including Huawei, Xiaomi, Oppo and Vivo, the sources said. This has helped the company score a gross margin of up to 57.72% in 2021, higher than industry average, the sources noted.
Global RF frontend market is now still dominated by US-based Skyworks, Qorvo, Broadcom and Qualcomm, and Japan's Murata, who command a combined market share of over 80%, the sources added.