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Taiwan IC packaging, testing output may rise over 5% in Q3

TAIPEI -- The output value of Taiwan's integrated circuit (IC) packaging and testing sector could rise more than 5 percent in the third quarter from a quarter earlier because of peak season effects, according to a government research report.

In the report, the Industry and Technology Intelligence Services (IT IS,產業技術知識服務計畫) under the Ministry of Economic Affairs (經濟部) said the output of Taiwan's IC packaging business should total NT$86 billion (US$2.87 billion) in the third quarter, up 5.5 percent from a quarter earlier.

The third quarter output value of the domestic IC testing sector is forecast to rise 5.3 percent from a quarter earlier to NT$38 billion, the government agency said.

According to the ITIS, the local IC packaging and testing sector is expected to benefit from the launch of international mobile device brands in the third quarter, especially Apple Inc.'s unveiling of the next generation iPhone and iPad.

In fact, the U.S. consumer electronics giant has already stated building up component inventories, serving as a driver of growth for IC packagers and testers, the ITIS said.

On the downside, however, mobile devices from the non-Apple camp completed their efforts to stock inventories in the second quarter, which could compromise to some extent the local IC sector's production value in the current quarter, according to the ITIS.

In the second quarter, the domestic IC packaging sector's output value rose 14.8 percent from a quarter earlier to NT$81.5 billion, and that of the IC testing sector grew 14.6 percent from a quarter earlier to NT$36.1 billion.

The strong growth in the second quarter reflected demand for high-end IC packaging and testing technology due to rising smartphone sales in the non-Apple camp and the development of 4G network services in several countries.

For 2014 as a whole, the output value of the local IC packaging sector is expected to rise 13.6 percent from a year earlier to NT$323 billion, and the output value of the local IC testing business could grow 13 percent to NT$143.1 billion, the ITIS forecast.

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