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Sep, 2018 Industry Leading Provider of Outsourced Semiconductor Assembly, Test & Bumping Services

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Page 1: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Sep, 2018

Industry Leading Provider of Outsourced

Semiconductor Assembly, Test & Bumping Services

Page 2: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Safe Harbor Notice

This presentation contains certain forward-looking statements. These forward-looking

statements may be identified by words such as ‘believes,’ ‘expects,’ ‘anticipates,’

‘projects,’ ‘intends,’ ‘should,’ ‘seeks,’ ‘estimates,’ ‘future’ or similar expressions or by

discussion of, among other things, strategy, goals, plans or intentions. These

statements include financial projections and estimates and their underlying

assumptions, statements regarding plans, objectives and expectations with respect to

future operations, products and services, and statements regarding future

performance. Actual results may differ materially in the future from those reflected in

forward-looking statements contained in this document, due to various factors. Actual

results may differ materially in the future from those reflected in forward-looking

statements contained in this document, due to various factors. Further information

regarding these risks, uncertainties and other factors are included in the Company’s

most recent Annual Report on Form 20-F filed with the U.S. Securities and Exchange

commission (the “SEC”) and in the Company’s other filings with the SEC.

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Page 3: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Group Snapshot

Manufacturing footprint in China & Taiwan

Shanghai, China

Unimos (JV with Unigroup)

Hsinchu, Taiwan

ChipMOS Taiwan

Tainan, Taiwan

ChipMOS Taiwan

Overview

(1) As of June 30, 2018

Key milestones

2001 2000 2011 2014 2018 2015 2016

• Started TCP

package for

LCD driver IC

and 12" wafer

assembly and

testing

business

• ChipMOS

Bermuda listed

common shares

on the Nasdaq

exchange

market

• Set up 12”

Gold bumping,

Cu RDL, MCP,

Cu pillar, MCB

bumping and

WLCSP line

• Listed ChipMOS Taiwan on TWSE

• Announced the merger between ChipMOS Taiwan and ThaiLin

• Invested in JMC and Ryowa

• ChipMOS

Taiwan merged

ThaiLin

• Announced

strategic

partnership

with Tsinghua

Unigroup

• ChipMOS

Taiwan merged

ChipMOS

Bermuda and

issued ADS

(Nasdaq Ticker:

IMOS)

2017

• Completed

whole

investment

tranche of

Shanghai

facility in Q1

Founded : 1997

Headquarters : Hsinchu, Taiwan

Ticker Symbol : TWSE : 8150.TW

NASDAQ : IMOS (ADS)

Employees(1) : Taiwan : 5,955

3

• ChipMOS

Taiwan

formed

Shanghai

JV with

Tsinghua

Unigroup

Page 4: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Corporate Holding Structure

4

紫光宏茂微电子(上海)有限公司 Unimos Microelectronics (Shanghai) Co., Ltd.

Strategic investors led by Tsinghua Unigroup invested RMB 498.43 million for ChipMOS Shanghai-JV

closed on March 24, 2017, and capital injection done in March 2018, ChipMOS Shanghai received a

total RMB 1,074 million in funding

ChipMOS Shanghai already changed company name to Unimos on Jul/4’18, and new logo is in

registry process

ChipMOS is not consolidating Unimos post the JV closure. UniMOS becomes a long-term investment

of ChipMOS and recognized profit/loss generated pro rata.

100%

45% 7% 48%

Employee and strategic investors ChipMOS BVI

Page 5: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

ChipMOS Positioned to Expand Market Leadership

Memory DDIC

Core Technology

Mixed Signal

Offer turn-key solutions for core technology product segments

Dedicated OSAT capacity and strategically focused on collaboration-driven growth

Leverage current partnerships to expand customer base

5

Q2’18: 9%

Q2’18: 47% Q2’18: 44%

Page 6: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

6

Capture High Growth Market Position

Major OSAT for Taiwan niche DRAM makers

Supporting various automotive, display, smart speaker, and gaming products

NOR demand from display, automotive and entertainment center segments remains

strong, utilizing full wafer test capacities

Expanding NAND product type offerings

Added Cu based plating capacity to service non-driver customers

Integrating wafer bumping and assembly core technologies, to support multiple

growth opportunities in RDL, WLCSP, flip chip, power IC, & E-compass etc.

Partnering with key customer to capture new high-end smartphone demand and in

volume production since 3Q 2017

Expanding to multiple products using core technologies

Market penetration to proliferate across end customer offerings

Optical

Sensor

Memory

Mixed-

Signal

Page 7: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Technology Update – Bumping Trend for Memory

PC/Server DRAM is migrating from wire bond BOC to flip-chip package

Cu pillar bumping technology has been used on flip chip packaging

RDL has been used on multi-chip packaging for functionality or higher density

Re-Distribution Layer + wire bond

Copper Pillar Bumps

Re-Distribution Layer

Copper Pillar flip chip Bonding

Chip

substrate

Cu pillar Molding

Compound

7

Page 8: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

COF Growth

Stable demand of TV COF for continued 4K/UHD TV uptake higher penetration ratio

12” fine pitch COF new demand is coming from new panel features of smartphone, 18:9 format and narrow bezel

TDDI Transition in 2018

Integrating touch and DDIC function in one chip, more than x3 times test time compared to discrete DDIC.

Currently COG is majority, but some COF is emerging now

High TDDI penetration and strong demand in H2 of 2018

OLED Proliferation

>4 years 12” bumping of OLED driver production experience for Korea customer

Turn-key services of OLED driver, including 12” Au bumping & 12” COF, of other Korea customer is ramping up in H2 2018

Capturing the coming China OLED driver business with non-Korean OLED driver customers

DDIC

Capture High Growth Market Position of Display Driver

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Page 9: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Technology Update – Bumping Trend for DDIC

Driving for fine pitch and smaller bump size capability together with COF process in order

to fulfill the application like higher resolution, bezel-less phone or some OLED.

Fine Pitch Au Bumping COF Tape Inner Leads / Bonding

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Page 10: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Diversified Product Portfolio on Higher Growth Markets Q218

10

DDIC

38% Smart Mobile

20% Consumer

9% Computing

22% 11%

TV Auto/Industry

Smart phone

Tablet

Wearable device

DSC, STB

Pen driver

Game

Smart speaker

PC/Laptop

Server, SSD

Hard disk

Crypto-mining

UHD/4K TV Industrial PC

In-car Infotainment

ECU, ADAS

Memory & Mixed-signal

Page 11: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Infotainment Multimedia Module

(DRAM, NOR Flash, DDIC)

Radar system In-car sensor

(DRAM, NOR Flash)

ADAS (DRAM, NOR Flash)

Communication (DRAM, NOR Flash)

Growth in New Advanced Applications Market

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ECU (NOR Flash)

ChipMOS already was qualified by 7 of top 10 automotive electronic component suppliers

Page 12: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Fingerprint sensor

3D facing sensing

DDIC

DDIC TDDI OLED driver

Low power,

mobile DRAM

Load switch

E-compass, Gyro, …

Low power,

mobile DRAM

NOR (TDDI, OLED)

High ChipMOS Content in New Smartphones

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Load switch

E-compass, Gyro, …

16:9 18:9 Narrow Bezel

Full screen

More product content

Higher ASP

Page 13: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

More Intensive Process = Higher ASPs

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Page 14: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Conversion of 12” fine pitch COF for full screen panel and 18:9 panel

TDDI is ramping up

Leverage DDIC Leadership Position

14

YoY: >30%

QoQ: >12%

QoQ: 18%

Page 15: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Turnkey, High-yield, OSAT Partner of Choice

15

Memory Supply Chain

Design Wafer probing

(ChipMOS)

Ass’y/Test

(ChipMOS) Module Foundry

Design Foundry Wafer probing

(ChipMOS)

COF/COG

(ChipMOS)

Bumping

(ChipMOS)

COF film

Manufacture

Panel Module

DDIC Supply Chain

D D I C

Page 16: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

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Q2’18 Financial Highlights

Page 17: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Q2’18 Revenue Breakdown (unaudited)

By Manufacturing Segment By Product

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Page 18: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Q2’18 Capital Expenditures (unaudited)

18

CapEx

3,123.3

4,702.7

2,241.8

1,395.3

977.7

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

2016 2017 1H 18 Q2'17 Q2'18

( NT$ M)

Testing

38.3%

Assembly

6.0%

LCD

Driver

46.7%

Bumping

9.0%

Q2’18 CapEx Breakdown

Page 19: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

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Market Information

Page 20: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

New Smartphone Features Driving DDIC Revenue Growth

Source: WitsView Jul. & Aug., 2017

2015 - 2020 AMOLED & TDDI Penetration in Global Smartphone

Full-screen/18:9 switches COG to fine pitch COF and AMOLED require COF capacity

Integration of new smartphone features, including TDDI and fine pitch COF, driving need for

added test capacity

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Page 21: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

UHD/4K TV Growth DDIC COF Capacity Demand

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2015 - 2020 UHD TV growth

Source: Futuresource consulting, Apr.’2016 & HIS market Jan.’2017

UHD(4K) TV & OLED propel significant memory/storage market growth in set top boxes, TV,

home entertainment systems

Market penetration of UHD TV accelerating, & drives DDIC COF demand increasing

Page 22: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

New Applications Driving Increased NOR Demand

Source: HIS, Gartner, Synaptics, & summarized by Haitong Securities, 2017

New end-product & application drive NOR flash demand, and particularly wafer test capacity

Margin benefit from fully utilized, fully depreciated wafer testers for NOR flash

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Page 23: Industry Leading Provider of Outsourced …...3 •ChipMOS Taiwan formed Shanghai JV with Corporate Holding Structure 4 紫光宏茂微电子(上海)有限公司 Unimos Microelectronics

Company Website

http://www.chipmos.com

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