Deals
Apple will pay $1 billion to buy Intel’s smartphone modem unit. Under the terms of the agreement, Apple will hire 2,200 Intel employees and acquire Intel’s IP and equipment. The deal, expected to close in Q4, puts an end to Intel’s attempts to win a piece of the smartphone market. But the chipmaker retains the right to develop modems for non-smartphone applications, including PCs, IoT devices and autonomous vehicles.

Intel’s exit was no surprise. The big question was not “if,” but “when” and “how.” The company announced back in April that it was getting out of the smartphone modem business after Qualcomm and Apple settled a longstanding dispute. Apple was Intel’s largest customer. CEO Bob Swan said at the time, “…in the smartphone modem business it has become apparent that there is no clear path to profitability and positive returns.”

Mazda inked a deal with Siemens for Mentor‘s electrical design software suite, which the automaker will use to develop next-gen automotive electrical systems. Key factors include weight, speed of data transmission and cost, as well as the ability to make tradeoffs throughout the design cycle.

Tools
OptimalPlus uncorked lifecycle analytics for ADAS cameras, which the company says will improve reliability, reduce scrap rates, and lower the cost for manufacturing these devices. The approach leverages machine learning to analyze manufacturing data.

Numbers
UMC reported its Q2 earnings. Second-quarter revenue was $1.16 billion, up 10.6% from the previous quarter, but down 7.3% year over year. Of that number, 13% came from 28nm, and foundry utilization was 88%. Net income was $56 million for the quarter. “2Q19 results reflected higher contribution from 12″ technology nodes, which experienced strength from the wireless communication segment including chips found in entry level to mid-end smartphones, switches and routers,” said Jason Wang, co-president, in a statement.

CyberOptics reported its quarterly numbers, as well. Sales were $15 million for Q2, down 5% from the same period in 2018. Net income was $464,000, versus $740,000 in Q2 2018. “We expect sluggish market conditions to persist during the second half of 2019,” said Subodh Kulkarni, president and CEO, in a statement. “Despite near-term headwinds, investment in research and development will continue as we further strengthen CyberOptics ability to capitalize on strong growth opportunities for our 3D multi-reflection suppression (MRS)-enabled sensors and systems, and WaferSense products.”

Overall, the equipment market was down in Q2, according to SEMI. Billings were $2.01 billion in June, using a three-month average basis, down 2.5% compared with the May 2019 level of $2.07 billion, and 19% lower than the same period in 2018.


Fig. 1: June billings for semiconductor equipment. Source: SEMI

Wafer shipments also fell 2.2% in Q2 versus Q1, according to SEMI, down 5.6% from the same period in 2018. Neil Weaver, chairman of SEMI SMG and vice president at Shin Etsu Handotai America, pointed to “the same headwinds that are facing the broader industry,” but noted the broader outlook remains positive.

Trade wars
Reports from South Korea point to Japanese restrictions on the sale of semiconductor manufacturing equipment. Japan already has restricted exports of chemicals used for photoresists and etch. The two are arch-rivals in technology, as well as a long history of geopolitical hostilities.

At the same time, the trade war between the U.S. and China is showing signs of softening. The Trump administration will give “timely” licensing decisions to allow companies to sell to Huawei, and China has agreed to continue buying U.S. agricultural products, according to CNBC.

Alibaba, meanwhile, showed off its first internally developed microprocessor. Like rivals Amazon and Google, Alibaba wants to optimize for AI and machine learning applications, and existing CPU- and GPU-based solutions are either too slow or power-intensive. Alibaba’s chip is based on the open-source RISC-V ISA. The company’s efforts in this space were well-known. Alibaba is a platinum member of the RISC-V Foundation, but the timing is particularly noteworthy because of the Chinese government’s push for internally developed technology in light of trade war restrictions.

People
Applied Materials appointed Yvonne McGill to its board. McGill is the CFO at Dell Technologies and senior vice president of the company’s Infrastructure Solutions Group.

Events
Find upcoming semiconductor industry events here, including the upcoming Flash Memory Summit and the Hot Chips Conference.

Ed Sperling

Ed Sperling

  (all posts)

Ed Sperling is the editor in chief of Semiconductor Engineering.

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