Wall Street Journal: TSMC Intel contends, each has hidden concerns

  The Wall Street Journal reported that the semiconductor duo TSMC and Intel are fiercely competitive. TSMC's process technology is leading, but its performance is dragged down by the iPhone's demand. Intel's recent share price performance is bright, and it is expected to pay a bright annual report, but good fortune is not easy to maintain.

TSMC's process technology for reducing microprocessor size surpassed Intel last year and used this technology to produce iPhone application processors for Apple and to create popular graphics chips designed by NVIDIA. According to the report, TSMC has made Intel's life very difficult.

However, the technology is leading, failing to let TSMC escape the pain caused by weak market demand. The iPhone's buying and cooling, along with the rupture of the cryptocurrency bubble such as Bitcoin, led to a surge in the inventory of graphics chips required for "mining", which has impacted TSMC's performance.

TSMC is conservatively looking at the semiconductor industry. This week, it is estimated that revenue for the first quarter of this year will reach US$7.3 billion to US$7.4 billion, a quarterly decrease of about 22%, and the recession will be greater than the market expectation of 10%-20%.

In contrast, Intel is expected to announce an extremely eye-catching annual report next week, with revenues and operating interests hitting record highs and paying the best growth rate since 2011. Intel has benefited from the tight supply of chips in the industry, and its products, which are mainly placed on the PC and server market, have escaped the storm of weak demand for smart phones.

But Intel also faces many challenges. As Intel increases capital expenditures and increases production capacity, the high price of PC chips is expected to ease. In addition, PC demand showed signs of cooling after two quarters of growth, and research firm Gartner estimated that global PC shipments in the fourth quarter of last year were down 4%.

In the data center, AMD launched the latest server chip from TSMC, and it is expected to dig away part of Intel's market. At the same time, the cloud sales boom that Amazon and other cloud service providers have invested in over the past two years may have cooled.

In addition, Intel’s former chief executive, Brian Krzanich, has not yet reached the stage after his personal misconduct last year. Intel's share price performance in the past quarter was among the best in technology-weighted stocks. The Wall Street Journal believes that Intel's stock price will continue to be difficult.