After becoming a contract supplier to Renesas Electronics Corp., Taiwan Semiconductor Manufacturing Co. (TSMC) is likely to win contracts from Fujitsu Semiconductor Ltd.

According to Japanese media reports, Fujitsu is considering farming out production of its next-generation SPARC 64 processor for Unix servers to TSMC, currently the world's No.1 pure silicon foundry. Once the deal is signed, it will be Fujitsu's first-time outsourcing for SPARC 64 processors.

Also, the two companies are reportedly working together on 28nm process for next-generation SPARC 64 processors as a replacement for 45nm process used on first-generation SPARC 64.

Should Fujitsu decide to designate TSMC as its contract supplier, it will become another Japanese chipmaker to contract TSMC after Renesas, which is currently the world's No.1 supplier of micro control units (MCUs).

TSMC Chairman and Chief Executive Officer (CEO) Morris Chang pointed out that Renesas' orders mean a lot to the company and foretell that in five years Renesas will become one of the company's primary customers.

Industry executives estimate Japanese contract buyers will contribute increased revenue to TSMC, which now depends on Japanese buyers for only 4% of its revenue.

TSMC has set its revenue goal for the second quarter at NT$126-128 billion (US$4.3-4.4 billion at US$1: NT$29), an increase of 19.4-21.3% from the first quarter. The firm's revenue hit new highs for two consecutive months in April and May, together attaining 66% of the company's goal for the second quarter.

Regardless of uncertain macro economy, orders for the company's 28nm process foundry remain strong and are estimated to inundate the company's 28nm process capacity into the third quarter. Industry executives estimate the company's supply of 28nm process capacity will not fully meet demands until next year.

source & copyright: CENS

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