Minxin shares: MEMS wafer foundry production line is not within the scope of sanctions, and the construction of packaging and testing plants will be accelerated

As the first MEMS chip stock on the Science and Technology Innovation Board, Minxin has developed over a decade and now has a MEMS silicon microphone, pressure sensor and acceleration sensor product line based on self-developed MEMS/ASIC chips with proprietary intellectual property rights, with product shipments exceeding 1 billion. At the same time, Minxin has a complete localized industrial chain based in mainland China, and is highly regarded by the capital market.

Recently, Minxin Co., Ltd. released information disclosure on investor relations exchanges. The company's overall goal is to continue to deepen its presence in the MEMS sensor field, develop from multiple dimensions both horizontally and vertically, and become a highly competitive company in the industry. Horizontally, Minxin will develop more types of MEMS sensor products, and quickly industrialize them, expand emerging application areas, and seize the opportunities for industry development; vertically, Minxin will further expand its business, covering products such as MEMS sensor devices and modules, further expand the company's business scale, and enhance the company's profitability; based on the horizontal and vertical development goals, the company will plan from aspects such as technology research and development, product production, and market promotion, and implement them in accordance with the plan to continuously enhance the company's industry competitiveness and industry status.

Improve customer level, MEMS wafer foundry production line is not within the scope of sanctions

Since its establishment, Minxin Co., Ltd. has insisted on independent research and development and design of MEMS sensor chips. In the absence of a mature and professional MEMS production system in the country at the beginning of its establishment, after more than ten years of investment in research and development and production system construction, it has completed the basic research and development work and core technology accumulation in each link of MEMS sensor chip design, wafer manufacturing, packaging and testing, and has deeply participated in the development of MEMS processing technology of domestic third-party semiconductor manufacturers, thus realizing the localization of the entire production link of MEMS products.

Since the beginning of this year, due to the spread of the COVID-19 pandemic and the intensification of Sino-US trade frictions, some overseas supply systems of domestic consumer electronics manufacturers have been restricted, and the outsourcing chip model of domestic acoustic precision device manufacturers may also be adversely affected. Minxin shares said that in this context, considering the supply chain security and the company's advantages in the domestic production system, some well-known traditional consumer electronics brand manufacturers such as mobile phones have also begun to accelerate the cooperation process with the company.

Minxin Co., Ltd. stated that the gap between the company and its main competitors in the same industry is not a technological gap, but mainly a gap in customer resources. The main competitors in the same industry mainly supply globally renowned consumer electronics brands such as Huawei, Apple, Samsung, and Amazon, and can understand these top customers' latest requirements for product definitions and performance parameter indicators ahead of other companies in the industry and carry out product research and development one step ahead; therefore, the gap between the company and its main competitors in the same industry is reflected in the acquisition of top customer product parameter information, rather than product technology level and R&D capabilities. Therefore, the company will increase investment in all aspects, improve customer levels, obtain the needs of top customers as soon as possible, and accelerate the progress of the company's new product research and development.

In terms of production capacity and technology, Minxin shares stated that the current production capacity of the company's wafer foundries, including SMIC, SMIC Shaoxing and China Resources Shanghua, can meet the company's current needs; the production capacity of the company's packaging foundry Huatian Technology can also meet the company's needs. With the subsequent production of the company's self-built packaging and testing plant, the entire packaging and testing capacity can also meet the company's subsequent capacity needs for serving major customers. Regarding production technology, the production technology of the foundry is still very good after a long period of running-in with the company. The company's shipments can currently rank fourth in the world, which is inseparable from the full running-in of the production technology of the company and the foundry.

Minxin shares emphasized that the production line used by SMIC for the company's MEMS wafer foundry is not within the scope of the chip process sanctioned by the United States, so the possibility of being affected is very small. In addition to SMIC, there are other wafer foundry manufacturers, such as China Resources Shanghua, etc., and the wafer production capacity supply is fully guaranteed.

MEMS silicon microphone shipments ranked fourth in the world, and built its own packaging and testing plant to improve product quality

It is well known in the industry that compared with the large-scale integrated circuit industry, the research and development steps of MEMS products are more complicated. In addition to completing the design of MEMS sensor chips, it is also necessary to develop a MEMS wafer manufacturing process suitable for the company's chip design route. In the case that wafer manufacturers lack mature MEMS process modules, the company needs to participate in the development of manufacturing process modules suitable for wafer manufacturers. Even if the wafer manufacturer already has mature manufacturing process modules, it is necessary to determine the specific process flow of each chip according to the company's chip design route.

At the same time, because MEMS sensors have the functions of acquiring and converting external signals, the downstream application scenarios are diverse, and the extremely small mechanical systems inside the products are relatively sensitive to the external application environment, it is also necessary to be responsible for the development of MEMS professional test equipment systems and test technologies to meet the performance and quality testing needs of MEMS sensor products. Therefore, the MEMS sensor industry has barriers in chip design, wafer manufacturing, packaging and testing.

Looking at the major manufacturers in the global MEMS industry, none of them have done a comprehensive job in the MEMS sub-sectors, but instead focus on a few of them. Minxin Co., Ltd. stated that, on the one hand, this is due to the non-standardization of MEMS technology and processes, that is, MEMS sensors have the characteristics of one product and one processing technology. MEMS sensor products are diverse, and the functions and application fields of various products are also different, which makes the production process and packaging process of various MEMS sensors need to be debugged according to the product design, and the product testing process also adopts non-standard processes. Therefore, MEMS sensor products have the situation of "one product, one process", which requires long-term research and development and investment in various production factors such as product design, production process, equipment development and material selection from basic research and development, and continuously improve and optimize the above production factors in the process of large-scale shipments.

On the other hand, due to the characteristics of small batches and multiple varieties in some MEMS sub-industries, the economic benefits are not obvious. Therefore, the major companies in the industry will focus on the sub-sectors with relatively large market space from the perspective of contribution to their own revenue and profits, thus forming such a market structure.

From the perspective of the market structure of the MEMS industry in 2017, MEMS products are mainly sensors. In the field of MEMS actuators, the market size of RF MEMS and inkjet print heads is relatively large. The MEMS microphones, pressure sensors and inertial sensors (including accelerometers, gyroscopes, magnetic sensors and inertial sensor combinations) in which Minxin shares are currently located account for a large proportion of the market size of the entire MEMS industry.

Minxin Co., Ltd. stated that MEMS silicon microphones are currently a major business of the company, accounting for a high proportion of the company's operating income; in addition, because it takes time for the company to cultivate a new product line, silicon microphones will still be a major business of the company in the next few years; although the company's current shipments in the MEMS silicon microphone field have ranked fourth in the world, in fact, the product market share is not high, at around 7%; with the continuous emergence of new product application areas in the future, there is still a lot of room for growth in silicon microphone shipments; at the same time, core mainstream customers at home and abroad have very high requirements for production capacity and quality, so in order to achieve a breakthrough in core mainstream customers, the company also invested in the construction of its own packaging and testing plant, Suzhou Desbei Electronics Co., Ltd., last year to make adequate preparations.