Shooter, I don't check VIC everyday. Let me know if you want to exchange contact info and I will send you my direct email. If you email me directly with a question on SEMI, I'll... login to read the rest
YCOMBINATOR, thanks for the assist.
MPK, I am not sure where you saw that wafer shipments have been flattish. Maybe overall for both 200mm and 300mm but I think it is important to distinguish between 200... login to read the rest
Re: Re: why haven't we seen more consolidation already?
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thanks gary (and thanks to YCOMBINATOR for his response.)
do you think Siltronic could, instead, be the acquirer? if so, who is more likely to buy whom? I noticed a bunch of language in the annual... login to read the rest
Re: why haven't we seen more consolidation already?
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I would agree that SEMI, Siltronic and LG Siltron would all benefit from coming together. SEMI's management is well aware of this. I have never seen a management team so focused on trying to merge... login to read the rest
Not gary, but some thoughts on positives/negatives for silicon area demand.
1) Yes, Moore's Law has always been a headwind to silicon area demand. Here are the dimensions of INTC's mainstream quad-core chips at each node.
45nm... login to read the rest
I don't know the answer, but I have a thought and wanted to see what you think:
https://www.dropbox.com/s/w51iax9s7iq8q03/wafer%20shipments.JPG?dl=0
if wafer shipments - measured in square inches - have been flattish since 2010, could this be the reason we... login to read the rest
gary,
seems to me that market shares in the wafer biz today are not much different than they were a decade ago. why is that? I mean, I do realize that transitions to larger wafer sizes... login to read the rest
Thanks Gary. Nice to find opportunities where your cost is not only locked but coming down.
On the revenue side went back through the filings and it seems like every year they are off due to... login to read the rest
I spoke to the company about this and they said that 450mm isn't going to be a significant portion of the industry for a very long time. the last numbers I saw suggested 450mm might... login to read the rest
Got it, thanks for the response gary - have a good sense for how you're getting to the 10% now.
And agree that the real story here is pricing - I'm just trying to build out a
The SEC filing detailing SUNE's obligation to sell to SEMI the poly it needs for $20 is here.
http://www.sec.gov/Archives/edgar/data/1585854/000119312515232440/d949093dex101.htm
The exact pricing isn't shown in the 8-K for competitive reasons but SEMI's management has stated that it... login to read the rest
Hi Gary,
Thanks for the write-up. We are also new to the story.
If the fabs eventually move to 450mm wafers (INTC has been talking about this for a few years, sounds like it has been put
In my last reponse to your question I created a chart that walks you through my math. SUNE charges SEMI in the low $30s for polysilicon. I used $35. You can use $30 if you... login to read the rest
Mgmt on the Q1 call said their poly cost "is about $30", and that "it's been about that for the past three or four quarters", which would lead me to believe there is $10/kg of... login to read the rest
SEMI consumes ~3,000 tons of polysilicon a year (3,000,000 kgs) . They get the majority from SUNE (currently at ~$35 Kg) but not all and what they don't get from SUNE they pay market rates... login to read the rest
Gartner originally thought the semi industry would grow 5% this year. They now think it will grow 2%. Utilization at wafer manufacturers is around 95% to 97% currently. Wafers input costs are ~2% of the total... login to read the rest
I haven't bifurcated CapEx into defensive vs offensive. SEMI's CapEX has been ~$95 to $100 million and managementhas stated that this is the approximate level of CapEx that we should expect for the next few... login to read the rest
Hi gary9,
Recently, Gartner revised down its global estimates to 2.2%. How does that affect the price increase argument? With demand down, wouldn't it be a lot harder for Shin-Etsu and Sumco to argue for a
Everyone making wafers needs polysilicon. Either you buy it in the open market, get a long term contract or build a facility to create your own. If someone bought SEMI's plants that had to buy poly... login to read the rest
SEMI's CFO said $20 and it is likely to decline from that level. $60 is mentioned in filings. Excerpt from page 60 of SEMI prospectus filed in Jan.
During 2013, the average price per kilogram for... login to read the rest
Gary,
Thanks for an interesting write-up. You've mentioned a number of times the arb between EV and replacement cost, but would this set of plants be profitable without the poly subsidy from the former parent? Might... login to read the rest
China entering the market is a risk but there are two mitigants :
1) The Chinese government has taken a lesson from the disaster that was the Chinese government funded solar panel industry. This time they... login to read the rest
Thanks. I'm not sure what the right valuation is for SEMI but I do know SUNE is in a hurry to simplify its corporate structure so I can see them rushing to get the deal... login to read the rest
SEMI and its peers are at ~98% utilization and demand is expected to grow by 5% next year, resulting in a shortage. The wafers that SEMI makes go into every device that has a semiconductor... login to read the rest
Wafers are generally priced in yen or dollars.
SUMCO and Shin-Etsu have greater scale (both are about 2x the size of SEMI) and as a result are able to produce wafers for less cost than SEMI.
SUMCO and Shin-Etsu... login to read the rest
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