TSMC Kumamoto Fab Secures Major Sony CIS Order

In response to the accelerating AI revolution, there is a growing demand for enhanced specifications in CMOS sensors (CIS). With the formal inauguration of TSMC's Kumamoto Fab 1, Sony, a global leader in CIS technology, has strategically placed substantial orders, gearing up for the anticipated mass production in the fourth quarter and optimizing the utilization rate of the newly launched facility.

While TSMC maintains its tradition of not disclosing individual clients or orders, market observers express optimism regarding TSMC's surge in ADR closing by over 4% on March 1st, reaching a historic high of $133.9 per share. This surge is attributed to the parallel adoption of TSMC's advanced processes and overseas mature processes.

CIS, renowned for its compact size and cost-effectiveness, surpasses CCD in market share and is extensively utilized in diverse sectors such as mobile technology, automotive, security, and healthcare, serving as a pivotal component in high-value lens modules.

Experts acknowledge a previous inventory adjustment challenge in the CIS component market, spanning over a year. However, since the latter half of the previous year, as clients resumed replenishing stocks and with the catalyzing effect of AI, various terminal applications have begun embracing lenses tailor-made for AI applications. This trend is expected to usher in a renewed demand for CIS components, offering lucrative opportunities for businesses focusing on AI lenses.

Sony, foreseeing opportunities in the automotive and consumer sectors, plans to leverage TSMC's 22nm process for the production of CIS components and Image Signal Processor (ISP) chips. The company has introduced a cutting-edge digital signal processor (DSP) featuring AI algorithms, capable of analyzing body movements and enhancing image processing for applications like human tracking. Sony has already secured substantial orders, positioning itself as a major player in the upcoming AI generation.

TSMC's recently inaugurated Kumamoto Fab is currently in the equipment installation phase, with mass production projected to commence in the fourth quarter. The facility will primarily focus on providing 40nm, 28nm, and 22nm processes, catering to clients in the automotive and industrial sectors.

JASM, TSMC's joint venture in Japan, boasts Sony as its largest shareholder alongside TSMC. Industry experts note that Sony has been a significant client of TSMC for outsourced wafer production over several years. With the imminent commencement of mass production at TSMC Kumamoto Fab, Sony is poised to secure a substantial portion of wafer capacity, emerging as a major client contributing to the facility's utilization rate.