Titan Foundries' Revenue Slips 5.4%, Yet Endures with Rush Orders, Subsidies, and AI Demand
- By Chen Cheng-hui / Staff reporter
Leading Semiconductor Manufacturer, TSMC, Maintains Dominance with a 67.6% Stake in Global Foundry Market
The global wafer foundry market saw a slight 5.4% revenue dip in the first quarter of 2025, with seasonality playing a significant role[2][3]. Yet, TSMC continues to reign supreme, bolstered by rush orders, China's subsidies, and AI demands.
TSMC, the undisputed champion, achieved US$25.52 billion in sales, a 5% decrease from the previous quarter. However, its market share leapt from 67.1% to 67.6%[2]. What accounts for this remarkable resilience?
Firstly, smartphone-related wafer shipments saw a plunge due to typical seasonal factors[2]. But the demand for AI and HPC devices, coupled with urgent TV-related orders due to tariff measures, acted as a buffer, preventing a more significant revenue decline[2].
Samsung, TSMC's closest rival, wasn't as fortunate. Its sales tumbled 11.3% sequentially to US$2.89 billion, causing its market share to slide from 8.1% to 7.7%[2]. TrendForce attributes Samsung's slump to fewer benefits from China's subsidy programs and U.S. restrictions on advanced chips[2].
In defense of the South Korean giant, it's worth noting that the gap between TSMC and Samsung has widened to 59.9 percentage points from 59 points a quarter earlier[2]. However, TSMC shares closed up 1.01% at NT$1,005, surpassing NT$1,000 since March 7[2].
Meanwhile, Chinese chipmaker Semiconductor Manufacturing International Corp (SMIC) was on the rise, exhibiting greater competitiveness in mature nodes. In Q1 2025, SMIC reported US$2.25 billion in revenue, a 1.8% quarterly increase, and a 6% market share[2]. The gap between SMIC and Samsung shrank to 1.7 percentage points, narrowing from 2.6 points three months earlier[2].
The remaining players in the top 10 included United Microelectronics Corp (聯電), GlobalFoundries Inc, Huahong Group (華虹), Vanguard International Semiconductor Corp (世界先進), Tower Semiconductor Ltd, NexChip Co (晶合集成), and Powerchip Semiconductor Manufacturing Corp (力積電)[2].
Despite the 5.4% dip in the collective revenue of the top 10 foundries, the industry was still driven by ongoing China subsidy programs, pre-launch inventories for new smartphone models, and steady demand for AI and HPC applications[2]. Although the influence of tariff-driven pre-orders is expected to subside in the second quarter, capacity utilization and revenue should continue to be bolstered in the near term[2].
Enriched Insights:
The 5.4% decline in the combined revenue of the top 10 foundries in the first quarter of 2025 was primarily due to seasonal weakness typical of the first quarter[2][3]. However, several factors helped mitigate this decline:
- Rush Orders Ahead of Tariff Exemptions: Clients placed urgent orders before the U.S. reciprocal tariff exemption deadline, contributing to a partial offset of the revenue drop[2][4].
- China's Consumer Subsidies: Continued momentum from China's 2024 consumer subsidy program provided additional support, helping to stabilize demand and soften the downturn[2][3].
- Demand for AI and HPC Devices: Stable demand for AI and HPC applications also played a role in supporting revenue levels during this period[2][3].
These factors, combined with pre-launch inventory builds for new smartphone models, helped maintain capacity utilization and support revenue for the top foundries[2][3]. Despite these efforts, the effect of tariff-driven early procurement is expected to fade in the second quarter, potentially leading to a general slowdown[2].
In the context of Titan Foundries' revenue drop, data-and-cloud-computing technology played a crucial role in mitigating the decline. The demand for AI and HPC devices provided a buffer, preventing a more significant revenue decline, as stated in the enriched insights section. Moreover, the ongoing China subsidy programs also bolstered revenue, contributing to the endurance of the foundries despite the slight revenue dip.
