Taiwan Semiconductor Manufacturing Company (TSMC) has revised downward its forecast for 2017 global foundry growth to 5% from 7% due to elevated inventory in the supply chain.

TSMC's less-optimistic revenue outlook for the second quarter reflects "a quite severe inventory adjustment by our customers, particularly in smartphone and PC markets," said company co-CEO Mark Liu at an April 13 investors meeting. TSMC expects to post a 8-9% sequential decrease in consolidated revenues for the second quarter of 2017.

TSMC has raised its overall IC market outlook for 2017, however. A stonger memory market will lead to a 7% rise in the global 2017 market for ICs, Liu indicated. Excluding memory, the overall chip sector will see a smaller 4% increase, Liu said.

Nevertheless, TSMC's target of a 5-10% increase in 2017 sales remains unchanged, according to Liu.

In addition, TSMC disclosed it will be ramping up production of 10nm chips "very fast" in the second half of 2017, company co-CEO CC Wei noted. The newer node technology will account for about 10% of TSMC's total wafer revenues in 2017, Wei said.

As for TSMC's 7nm process technology, more than 30 customers are actively engaged with TSMC on the process, and the foundry expects to have 15 customer tape-outs in 2017, Wei indicated. TSMC is scheduled to move its 7nm process technology dubbed N7 risk production later in the second quarter of 2017, followed by volume production in 2018, according to Wei.

Wei added more than half of the customer product tape-outs with TSMC's 7nm are HPC products. HPC will become TSMC's major growth engine starting 2020, Wei indicated.

TSMC also plans to introduce an improved version of its 7nm process technology dubbed N7 Plus in just one year after its N7 launch, Wei said. The N7 Plus will adopt extreme ultraviolet (EUV) lithography technology.

TSMC will fully implement EUV to make 5nm chips. The foundry has been working with its major clients to define 5nm specs and to develop technology to support them, Wei indicated. TSMC expects to move its 5nm process technology dubbed N5 to volume production in 2020, Wei said.

In addition, Wei talked about TSMC's 12nm process technology, which provides its mobile chip customers better cost structure to develop solutions for entry-level and mid-range devices. More than 10 customers have been actively engaged with seven tape-outs being planned in 2017, Wei disclosed.

TSMC will also roll out a 12nm Ultra Low Power (12ULP) node to target IoT applications, Wei added. TSMC also introduced 22ULP, a half node of its 28nm technology, which has been developed for applications requiring lower operating voltage. TSMC expects to begin 22ULP volume production in 2018, according to Wei.