The attack of the European three semiconductor giants
Latest update time：2021-05-31
Reads：
At the end of last year, 17 EU countries announced that they would invest 145 billion euros (about 1.2 trillion yuan) in the next two to three years to promote joint research and investment in advanced processors and other semiconductor technologies among EU countries.
As representatives of European semiconductor companies, Infineon, ST and NXP's layout in the semiconductor industry is worthy of our attention.
How strong are the traditional three powers in Europe?
According to the sales of the world's top 15 semiconductor companies in the first quarter of 2021 released by ICinsights, Infineon and ST are the European semiconductor manufacturers shortlisted in this list, ranking 12th and 14th respectively. The report further emphasizes that if the pure wafer foundry TSMC is excluded, then NXP, headquartered in the Netherlands, will also be shortlisted in this list. According to the report, in Q1 2021, NXP's revenue was US$2.503 billion.
It is worth noting that according to ICinsights statistics, Infineon and ST both achieved double-digit year-on-year sales growth in the quarter. NXP is not far behind, according to its financial report, NXP's first quarter sales increased by 27% year-on-year.
From this data, it can be seen that European semiconductor manufacturers still occupy an important position in the semiconductor industry.
The cornerstone of Europe's semiconductor industry
As one of the regions that developed the semiconductor industry early, Europe regards the automotive semiconductor and industrial semiconductor market segments as the key directions for the development of the semiconductor industry. Based on this, Europe has also nurtured giants in automotive semiconductors and industrial semiconductors, which is also the cornerstone for European semiconductor companies to be on the list.
Specifically, Infineon has four divisions, namely automotive electronics (ATV), industrial power control (IPC), power and sensor systems division, and digital safety solutions (CSS). According to its official website, its automotive division is responsible for businesses related to automotive electronic semiconductors. The industrial power control segment focuses on power semiconductors mainly used in industrial applications, while the power and sensor systems segment is mainly aimed at consumer-oriented applications and power supplies. Activities related to classic and new safety applications are merged in the "Connected Safety Systems" section.
According to Infineon's second quarter financial report for the 2021 fiscal year ending March 31, 2021, the company's revenue reached 2.7 billion euros and its gross profit margin was 36.0% in the quarter.
(Infineon's revenue and gross profit in the second quarter of fiscal year 2021)
In terms of business division, Infineon's ATV division had revenue of 1.219 billion euros in the second quarter, which is also the largest source of revenue for Infineon. They occupy a leading position in many automotive semiconductor segments, including automotive power devices and power supply devices. In addition, in terms of industrial control, Infineon also occupies the first position in the industry in many fields.
(Infineon's automotive business, source: Infineon)
(Infineon Technologies' industrial control business, source: Infineon Technologies)
From the perspective of STMicroelectronics, the company is divided into three departments according to products: Automotive and Discrete Products Group (ADG), Analog Devices, MEMS and Sensors Group (AMS), and Microcontroller and Digital IC Products Group (MDG).
According to the financial report released by STMicroelectronics as of the first quarter of fiscal year 2021, net revenue in the first quarter was US$3.016 billion, a year-on-year increase of 35.2%, and gross profit margin was 39.0%. In terms of business division, ADG business net revenue was US$1.043 billion, accounting for 35% of the company's total revenue; AMS business net revenue was US$1.083 billion, accounting for 36% of the company's total revenue; MDG business net revenue was US$886 million, accounting for 29% of the company's total revenue.
(STMicroelectronics gross profit in the first quarter of fiscal year 2021)
From the perspective of market position, according to the 2020 Global MCU Market Review and 2021 Market Outlook report released by Morgan Stanley, STMicroelectronics occupies an advantageous position in the 32-bit MCU market. STMicroelectronics also has a good performance in areas such as ToF-according to relevant data, STMicroelectronics is the world's largest manufacturer of highly integrated ToF modules, and it has reached a milestone of 1 billion ToF sensor module shipments. In addition, STMicroelectronics is the third-ranked MEMS manufacturer, which allows them to make great strides in the industrial field. With its achievements in the sensor business and MEMS fields, STMicroelectronics is very competitive in the fields of automotive and industrial sensors.
NXP Semiconductors, another representative of European semiconductor companies, is able to provide high-performance mixed-signal and standard product solutions with its leading expertise in RF, analog, power management, interface, security and digital processing. Currently, NXP Semiconductors mainly focuses on four major markets: automotive electronics, industrial & IoT, mobile phones, communications & infrastructure.
According to NXP's first quarter 2021 financial report ending on April 4, 2021, in this quarter, by business, its automotive business revenue was US$1.229 billion; industrial and IoT business revenue was US$571 million; mobile device business revenue was US$346 million; and communication infrastructure and other business revenue was US$421 million. Among them, the automotive business is the main source of its revenue.
(NXP's gross profit in the first quarter of fiscal year 2021)
From the perspective of industry status, NXP focuses on in-vehicle communications and RF chip modules. Since NXP acquired Freescale in 2015, its share of the automotive semiconductor market has increased to 14.4%, making it the largest supplier of semiconductors in the automotive industry (until 2020, when Infineon acquired Cypress, NXP gave up its first place in automotive semiconductors). In addition, the industrial sector is NXP's second largest source of revenue, and it also has strong competitiveness in this field.
Another point worth noting is the gross profit performance of Infineon, STMicroelectronics and NXP, which is also an important factor in consolidating their dominance in the segment.
New competition above the foundation
In the past development process, European semiconductor manufacturers have accumulated advantages in the automotive and industrial fields. In the new round of technology iteration, the competition in the automotive and industrial fields around the development of third-generation semiconductors has also entered the second half.
In January 2015, Infineon completed the acquisition of International Rectifier, integrating advanced technologies in the field of third-generation compound semiconductors (i.e., gallium nitride). In 2018, Infineon acquired Dresden-based startup Siltectra GmbH. Siltectra developed the innovative cold split technology, which can efficiently process crystal materials and minimize material loss. Infineon will use cold split technology to cut silicon carbide (SiC) wafers, doubling the number of chips that can be produced from a single wafer.
In 2019, STMicroelectronics signed a contract with Cree to purchase SiC wafers worth more than US$500 million, and also completed the overall acquisition of Swedish silicon carbide (SiC) wafer manufacturer Norstel AB (Norstel), which produces 150mm SiC bare wafers and epitaxial wafers. In terms of gallium nitride, last year, STMicroelectronics signed a majority equity merger agreement with French gallium nitride innovation company Exagan. Exagan's epitaxial process, product development and application experience will broaden and advance STMicroelectronics' development plans and business for automotive, industrial and consumer power GaN. In the same year, STMicroelectronics joined hands with TSMC to accelerate the development of gallium nitride (GaN) process technology and the supply of GaN discrete and integrated devices. In its official press release, it stated that through this cooperation, STMicroelectronics' innovative strategic gallium nitride products will adopt TSMC's industry-leading GaN manufacturing process.
Benefiting from the characteristics of third-generation semiconductors, this material is also widely used in RF devices. At the same time, driven by new scenarios, RF devices have also ushered in new development opportunities, and European semiconductor manufacturers have also sensed this opportunity.
Judging from STMicroelectronics' actions, its three major acquisitions in 2020 were all concentrated on wireless product lines, including the acquisition of SOMOS, ultra-wideband (UWB) technology company BeSpoon, and Riot Micro's cellular IoT connection assets. In the same year, STMicroelectronics also joined the UWB Alliance. STMicroelectronics has stated that by integrating UWB, a key security positioning technology, into the STM32 product portfolio, it can be applied to IoT, automotive and mobile communication application scenarios to achieve secure access, accurate indoor and outdoor mapping and other services.
NXP also has a presence in the RF field. In May 2019, NXP announced the acquisition of Marvell's wireless connectivity business for US$1.76 billion. The main product lines involved are Marvell's Wi-Fi and Bluetooth connectivity products. NXP made this acquisition mainly to strengthen its wireless communications capabilities in the industrial and automotive fields.
Unlike STMicroelectronics and NXP, after Infineon terminated its plan to acquire Cree's Wolfspeed power and RF division, Infineon changed from buyer to seller and sold its RF power business to Cree for 345 million euros (this year, Cree announced that it will officially change its name to Wolfspeed at the end of 2021). Regarding this transaction, Infineon CEO Reinhard Ploss said: "Cree is a high-quality buyer of Infineon's RF business and enjoys a high reputation in the industry. We are excited about the concept and prospects of the combined business. At the same time, after splitting off this business, we will be able to focus resources more effectively on Infineon's strategic growth areas and will retain a strong technology portfolio for the wireless market."
New layout of European semiconductor manufacturers
The emergence of new scenarios has promoted the development of new technologies. While generating new competition, it has also caused these manufacturers to begin to re-examine their strategic layout. This is especially true for European manufacturers focusing on niche areas.
As for Infineon, at the media communication meeting of Infineon Automotive Electronics Developer Conference last year, Cao Yanfei, senior vice president of Infineon Technologies Greater China and head of the Automotive Electronics Business Unit, introduced that after Infineon's acquisition of Cypress, the two companies will maximize the synergy effect and promote the "New Infineon" to achieve "1+1>2" by continuing to make efforts in the three major areas of new energy vehicles, autonomous driving and automotive comfort configuration.
In addition, at the third China International Import Expo last year, Infineon announced its latest investment plan in China. The company decided to expand the IGBT module production line of its Wuxi plant. After the expansion, the Wuxi plant will become one of Infineon's largest IGBT production bases. According to a report by the Daily Economic News, Jochen Hanebeck, Chief Operating Officer of Infineon Technologies, said: "China occupies an important strategic position in Infineon's global business. The upgrade and expansion of the Wuxi plant will not only further increase our production capacity in China, but will also help Infineon consolidate its leadership in the development of the global IGBT business."
STMicroelectronics' strategy for the automotive market remains unchanged, including the continuous expansion of ST's automotive electrification plan, making full use of silicon carbide, IGBT, microcontrollers and intelligent power solutions, and increasing investment in gallium nitride materials. Overall, according to Jerome Roux, executive vice president of marketing for Asia Pacific at STMicroelectronics, STMicroelectronics will selectively deploy personal electronics, communication equipment, computers and peripherals markets, giving full play to its custom design business model and unique core competitiveness.
At the same time, according to iawbs, STMicroelectronics also emphasized that China is one of STMicroelectronics' most important markets, and STMicroelectronics is using its extensive product portfolio and ecosystem to consolidate its market leadership in China. In the future, STMicroelectronics will provide a variety of applications and customized semiconductor solutions to meet the needs of its global customer base, including many increasingly innovative Chinese customers.
From the NXP perspective, according to previous reports from Semiconductor Industry Observer, Steve Owen, executive vice president of global sales and marketing at NXP, once said that NXP currently has a layout in the automotive smart driving cockpit, autonomous driving and assisted driving, as well as in-vehicle networks. The company's partners have also expanded from traditional OEMs and Tier 1 suppliers to emerging car manufacturers.
From the overall layout, NXP's current business focus includes digital instrument panels, battery management systems and radar systems in the automotive field, edge processing for secure connections in the industrial and Internet of Things fields, ultra-wideband combined with security and software in the mobile device field, and a product portfolio in the communications infrastructure field including 5G base station millimeter wave technology.
Final Thoughts
According to recent market news, European semiconductor manufacturers are not enthusiastic about the semiconductor alliance that the EU is preparing to establish. The reason is that the projects involved in the plan are not in their company's blueprint. From their layout, they will also develop around their strong areas in the future to expand their influence in the semiconductor industry.
In particular, the development of automotive semiconductors is favored by the industry and is often regarded as the next market that can shake up the semiconductor landscape. European semiconductor manufacturers with decades of accumulation in this field actually have inherent advantages. On the other hand, as IDM manufacturers, European semiconductor giants, without the constraints of chip manufacturing, their future strength cannot be underestimated.
*Disclaimer: This article is originally written by the author. The content of the article is the author's personal opinion. Semiconductor Industry Observer reprints it only to convey a different point of view. It does not mean that Semiconductor Industry Observer agrees or supports this point of view. If you have any objections, please contact Semiconductor Industry Observer.
Today is the 2692nd content shared by "Semiconductor Industry Observer" for you, welcome to follow.
Recommended Reading
★ The "problem" of eight-inch wafer fabs
★ “Simulation relies on mergers and acquisitions, logic relies on hits”
Semiconductor Industry Observation
" The first vertical media in semiconductor industry "
Real-time professional original depth
Scan the QR code , reply to the keywords below, and read more
Wafers｜ICs｜Equipment ｜Automotive Chips｜Storage｜United States｜Huawei｜Apple
Reply
Submit your article
and read "How to become a member of "Semiconductor Industry Observer""
Reply Search and you can easily find other articles that interest you!
京公网安备 11010802033920号