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Semiconductor sector surging into final hour

June 15, 2010 – Comments (5)

Shorts scrambling to cover as Sector gets bullish news from TSM - Taiwan Semi

TSMC Chang more upbeat on 2010 chip growth

Nancy Cheng, Hsinchu; Jessie Shen, DIGITIMES [Tuesday 15 June 2010]

http://www.digitimes.com/news/a20100615PD226.html

Morris Chang, chairman and CEO of Taiwan Semiconductor Manufacturing Company (TSMC), has again raised his forecast for chip market growth in 2010. Speaking at a shareholders meeting on June 15, Chang said the global semiconductor market is expected to grow 30% in 2010.

Chang previously predicted the overall chip market would rise 22% in 2010, which was already an upward revision from his earlier estimate of 18% growth.

Chang also upwardly revised its CAGR projection for the overall chip industry from 2011 to 2016. He now expects the global semiconductor market to grow with a CAGR of 7% over the next five years, higher than 4-6% that was earlier estimated.

Chang reiterated TSMC's consolidated revenues for 2010 will likely hit an all-time high, resetting the record of NT$333.16 billion (US$10.3 billion) in 2008. It also stands a chance of hitting record profits in 2010, Chang added.

Chang did not make changes to TSMC's capex plan for 2010. The budget remains at US$4.8 billion.

In addition, Chang cited localized sales and support as the main reason for TSMC has built a production plant in China, rather than cheap labor costs. More than 1,000 employees are stationed at its 8-inch plant located in the Shanghai Songjiang Industrial Zone, said Chang, adding that salaries for the workers will not be raised in the short-term.

Chang was quoted in previous reports saying the average wage for TSMC's staff at its Shanghai facility is 2,000 yuan (US$293) a month