Excess 4G handset chip inventories, including application processors and power amplifiers (PA), are dragging down fab utilization rates at related foundries, according to industry sources.
China-based Vanchip Technologies, for instance, has been under intense pressure to digest its excess 4G chip inventory, the sources said. Vanchip is a MediaTek subsidiary that specializes in RF front-end modules with PAs.
Due to the decline in demand for smartphone PAs, GaAs foundries like Win Semiconductors have seen their fab utilization rates drop to 30-40% or even lower, the sources indicated. The foundries' operations will also be hampered by a lack of growth in demand for base station and Wi-Fi device PAs in the first half of 2023.
Win Semi is scheduled to hold its quarterly investor conference on February 9 to provide its near-term outlook.
Win Semi has reported revenue fell 19.6% sequentially and 54.7% on year to NT$873 million (US$29.1 million) in January 2023.
Fellow GaAs foundry company Advanced Wireless Semiconductor (AWSC) saw its January revenue hit the lowest monthly level since April 2019. AWSC posted revenue of NT$119 million for January 2023, down 51.9% from a year earlier and 6.1% on month.
The global handset market is poised to stay flat or drop slightly in 2023, according to DIGITIMES Research. Most of the Android camp's shipment projections show a decline from 2022 and, at best, retain a flat aim.
Article translated by Jessie Shen
