Chartered ready for surge in 65nm chip production

Singaporean contract chipmaker Chartered Semiconductor Manufacturing Co. Ltd. said Friday that chips manufactured using a 65 nanometer process will account for 5 percent of its revenue as the technology enters commercial production.

Sumner Lemon

Fri, 27 Apr 2007 14:00:00 UTC

"We are moving slightly ahead of schedule with regards to 65nm production and we expect to start commercial shipments in the second quarter," said Chia Song Hwee, Chartered's president and CEO, during a conference call with investors on Friday.

Chips made using the 65nm process will account for approximately 5 percent of revenue during the second quarter, Chia said, adding the company expects to win further 65 nm orders during the second half of the year.

Despite anticipated high demand for the 65 nm process, overall demand for computer chips was sluggish during the first quarter and is expected to remain so during the second quarter before picking up during the second half of the year, Chia said.

Chips made using the 65 nm process will account for a "double-digit" percentage of the company's revenue by the fourth quarter, he said.

Based on Chartered's forecast that its second-quarter revenue will be flat compared to the first quarter, orders for 65 nm chips will likely be worth about US$16.2 million. The company Friday reported revenue of $323.8 million during the first quarter.

Chia did not name customers, but much of the expected surge in 65 nm orders during the second quarter will likely come from Advanced Micro Devices Inc., which uses Chartered to manufacture chips, including processors, when its own factories are at full capacity.

AMD plans to begin shipments of its quad-core Barcelona server processor, which requires the 65 nm manufacturing process, during the second quarter, with the first servers based on the new chip expected to hit the market during the third quarter.