Key companies in the semiconductor industry. (v1.0)

This is just a short blog identifying the key players in the semiconductor industry. Perhaps it provides a starting point for some investment research on your part? This is not to be considered professional financial advice from me. Please consult a financial planner for advice that suits you. 

The key companies that actually fabricate (called semiconductor foundries) the most advanced chips are Intel (US), Samsung (Korea), and TSMC (Taiwan - the dominant player today). The key semiconductor substrate material is typically silicon or sometimes compounds like gallium nitride, gallium arsenide or silicon carbide. The 5 nm process for silicon fab was first used in volume in 2020 by Samsung and TSMC. "5 nm" is used primarily as a marketing term by individual microchip manufacturers to refer to a new, improved generation of silicon semiconductor chips in terms of increased transistor density. Even higher densities will inevitably be reached. For example, in mid 2022, 3 nm process started rolling out. Quantum computing is an emerging technology on the horizon that is very different though.  

Intel was dominant in fab in the past but over decades it has faded relative to the competition. It is now investing about 100 billion dollars for more advanced fabrication in Arizona, Oregon, New Mexico and Ohio. The US Chips act allowed the US government to advance huge grants to Intel. It also has Fab plants in Israel and Ireland. It has advanced packaging plants in Malaysia, New Mexico and Poland. 

TSMC (currently at the top technologically in fab) primarily has facilities in Taiwan. It is countering anxiety in various countries about China invading Taiwan by expanding fabrication in other countries. For example, it is building some massive plants in Arizona, and it also has a plant in Washington. It recently got a huge grant from the US government from the Chips Act. It is also investing in huge chip fabrication in Japan and also possibly an advanced packaging facility there. 

Samsung primarily has facilities in South Korea. It is especially dominant in memory chips. It also has a huge fabrication plant in Texas with plans to expand to Arizona. It recently got a huge grant from the US Chips act.  Arizona is becoming a new major center of chip fabrication in US with Samsung, TSMC and Intel all converging there. 

Besides the big three, less advanced fab is done by many companies like SMIC (China), UMC (mostly Taiwan), GlobalFoundries (US), Hua Hong Semiconductor (China), PSMC Semiconductors (Taiwan),  Micron (US, Taiwan, Singapore, Japan, China), Tower Semiconductor (US, Israel, Japan), Texas Instruments (mostly US), Nanya (Taiwan),  CRMicro (China),  Qorvo (US), Rohm (Japan), Oki Electric Industry (Japan), Fuji Electric (Japan), Fujitsu (Japan), Kioxia (Japan), Hitachi (Japan), Mitsubishi Electric (Japan). Renesas (Japan), Infineon technologies (EU), X-fab (EU), Bosch (EU), ISRO/STAR-C/GAETEC (India), and Pragmatic Semiconductor (UK) to name a few. 

Micron (US company primarily focused on memory) is expanding aggressively in US. In September 2022, Micron announced they would invest $15 billion in a new facility in Boise. In October 2022 Micron announced a $100 billion expansion in Clay, New York. It recently got a huge grant from the US Chips Act. Micron is close to an agreement to commit at least 1 billion dollars toward setting up a semiconductor packaging factory in India. 

There are many chip design companies. Fabless manufacturing is the design and sale of hardware devices and semiconductor chips while outsourcing their fabrication (or fab) to a specialized manufacturer called a semiconductor foundry. These include NVidia (US), ARM (UK), Intel (US), TSMC (Taiwan), Qualcomm (US), Broadcom (US), AMD (US), Apple (US), Samsung (Korea), Micron (US), Arrow Electronics (US), Xilinx (US), and Applied Materials (US) to name a few. There are also promising startups like X-Silicon (US). 

The Buzz in the industry today is about AI and AI chips. Nvidia has taken an early lead, but others are in the chase. See article here: Intel Leads Industry Effort to Challenge Nvidia’s AI Dominance (msn.com) 

These design companies and foundries, design and manufacture a variety of chips including CPUs, GPUs, memory, AI chips, smart phones, embedded, analog, microcontrollers, LED's and power chips. Some companies both design and manufacture their chips called IDM's (Integrated Device Manufacturers). Intel disclosed more than 18 months ago that it was aiming to separate out the semiconductor foundry side of its business and the design teams that create its own products. This split makes the company's Product division just another customer for Intel Foundry Services, while allowing the latter to seek business from third parties.

The dominant player in the photolithographic equipment area that are essential for chip fabrication is ASML (Netherlands). Other players include Nikon Corporation (Japan), Canon Optical Equipment (China), Shanghai Nikon Precision Machinery Co (China), TSMC, Veeco Instruments Inc. (US), Conax Technologies (US), SUSS Microtec SE (EU), and KLA Corporation (US).  

The top four semiconductor test and measurement equipment companies are KLA-Tencor (US), Advantest (Japan), Teradyne (US), and Agilent Technologies (US).  Test and measurement are an integral part of the fab process. 

As you can see most of the key players are in East Asia and US with a few in Europe.