Taiwan IC Distributors See Growing Demand For 5G And Datacenter Applications

Taiwan-based IC distributors are seeing stable demand for chips used in cloud/edge computing, large datacenters, 5G base stations and servers, as consumers turn to services or entertainments digitally in the wake of the coronavirus outbreak.

Edom Technology, which saw revenues reach a new record in 2019 with an on-year growth of 20% and an over 50% increase in profitability, expects the global IT supply chain and the end market to see uncertainties due to the pandemic.

However, demand for 5G and datacenters has continued heating up, while emerging business segments such as true wireless stereo (TWS) earbuds, AIoT, industrial equipment and car-use devices are having strong potential for robust growths.

Macnica Galaxy, an IC channel distributor of the Japan-based Macnica group, is also optimistic about demand for chips used in cloud computing and datacenters, according to industry sources.

In 2019, Macnica Galaxy mainly distributed IC products for five major clients: Intel, Mellanox, On-Semi, Renesas and Dialog. With more Internet service providers set to expand their datacenter capacity in 2020, sales of Mellanox’s server motherboards are expected to grow strongly, while products from Renesas are also expected to see more clients thanks to Renesas’s merger with IDT, said the sources.

On-Semi’s car-use CMOS image sensors (CIS) are expected to grow stably and see shipments to surge in the second half with the release of a next-generation game console during the period.

The company’s IC products from Dialog mainly focus on handset charging-related devices. The company received orders from a non-Apple first-tier handset brand in 2019 and will continue mass shipments for the orders in 2020, the sources said, adding the company also expects to land orders for Dialog’s Bluetooth low energy (BLE) products.

Macnica Galaxy’s FPGA and acceleration cards from Intel are expected to maintain steadily sales growth, while its in-house analog IC and MOSFET product lines have already seen growths for three years straight.

Currently, Macnica Galaxy’s parent company is seeking to push into some high-end emerging application segments including AI robots and autonomous driving, and has already obtained permission to sell related solutions in Japan, the sources said. Macnica Galaxy is also set to begin promoting the solutions in Taiwan in 2020 with AI robots currently being deployed the fastest.

—Digitimes