Taiwan-based wafer foundries and IC packaging and testing houses, which have seen their in-house capacity fall short of customer demand since early 2010, will continue to operate under tight production schedules in the third quarter, according to industry sources.
Strong demand for consumer ICs is expected to surface in the third-quarter peak season, including that for key components of Apple's new products, the sources said. Apple has stepped up the purchasing of IC parts amid strong sales of the iPad and iPhone 4, and the component suppliers for the devices are demanding more capacity at their foundry partners and backend subcontractors, the sources indicated.
Demand for Apple's iPad and iPhone 4 will be one of the contributing factors to a strong third quarter for Taiwan's foundry chipmakers and backend suppliers, but will not play a significant role, a analyst commented.
The analyst pointed out that many downstream vendors in Europe have placed orders in advance for their products, especially notebooks, to be sold in Europe during the year-end holiday shopping season. Due to a weak euro, system makers are now sending their shipments by sea to save costs.