Joint Development with Fabless Companies and Foundries, and Support for Advanced Packaging through Compression Technology

「In the semiconductor manufacturing equipment business, sales to Taiwan and China increased against a backdrop of higher investment in general-purpose memory, while sales of singulation equipment rose substantially. As a result, net sales increased to ¥49.870 billion, up ¥911 million, or 1.9%, from the previous consolidated fiscal year.」

「Meanwhile, in the second quarter, semiconductor capital investment gradually recovered, mainly in China, Taiwan and other Asian regions, putting orders received and net sales on an upward trend. Profit at each stage also exceeded the initial forecast, as profit margins improved due to the sales mix of our proprietary compression equipment and molds exceeding expectations, in addition to improvements in the product mix.」

「[Semiconductor Manufacturing Equipment Business] ① Meet customer needs through process innovation ② Become the world’s cost leader through the use of DX and AI ③ Deliver one-of-a-kind products worldwide through a global development system」

「Sales of compression equipment and molds increased mainly because investment toward in-house semiconductor production continued in China and deliveries of equipment for generative AI-related applications progressed smoothly in South Korea.」

「Deliveries of compression equipment for generative AI-related applications began as scheduled in the third quarter, and full-scale deliveries are expected to begin from the fourth quarter onward.」

「① Strengthen the profitability of the semiconductor business by developing process businesses that capitalize on added value ② Strengthen the production system and financial foundation through MIP (Minimal Inventory & Period), aimed at shortening lead times and reducing inventory ③ Rapidly develop products that anticipate customer needs and meet SDG and ESG investment criteria through proactive allocation of resources to development ④ Capture market share through coordination between singulation and blades」

「▶ Expanding the applications of proprietary compression equipment　▶ Expanding the market by entering advanced markets (5G, automotive and AI) as well as mid-range and low-end markets」

「Against this backdrop, as semiconductor manufacturers’ appetite for capital investment continued to increase, the TOWA Group responded reliably to their needs as a leading semiconductor molding equipment company. As a result, business results remained solid, with orders received in the third quarter reaching a record ¥14.063 billion.」

「In addition, we completed development of a new transfer equipment model, SSN1240, designed, manufactured and sold entirely by a Chinese subsidiary, and held a ceremony to mark shipment of the first unit at TOWA’s Suzhou plant on 22 October 2020. SSN1240 is an automated molding system for low-end and mid-range products, such as power discrete semiconductors, for which demand for automated production is increasing as the market expands.」

「Profitability improved as sales of TOWA’s proprietary, high-value-added compression molds and equipment rose substantially to 2.1 times the previous year’s level, mainly for high-end devices such as memory, improving the product mix. In addition, the accounting write-down of platform inventory, consisting of standard components unaffected by customer-specific customization, decreased by ¥258 million year on year.」

「As a leading company in semiconductor molding equipment, we provided the market with various solutions, including shipping the industry’s first full-scale mass-production equipment for ultra-large-panel PLP, an advanced packaging technology.」

「Profitability improved due to continued cost reductions from the previous fourth quarter, a review of fixed costs and increased sales of our proprietary compression equipment, in which we hold a 100% market share. However, this was insufficient to offset the decline in the first quarter of the consolidated accounting period (April to June 2019), resulting in an operating loss of ¥276 million, compared with operating income of ¥811 million in the same period of the previous year. Orders for highly profitable compression equipment remain solid and are expected to continue contributing to improved profitability, so the deficit is expected to be eliminated from the second half onward.」

「To expand market share in the highly competitive transfer equipment market, we will pursue market development for low-end and mid-range products through collaboration among our 3 Chinese subsidiaries, including Towa Semiconductor Equipment (Nantong) Co., Ltd., which operates a mold manufacturing business.」

「Against this backdrop, as semiconductor devices are required to offer increasingly higher functionality and density, we began sales of the new PMC2030-D, which can mold advanced semiconductor devices with high efficiency, to expand sales of our proprietary compression equipment as the only solution for molding miniaturized and stacked semiconductor packages.」

「Our proprietary compression equipment has an unmatched competitive advantage as the optimal equipment for producing semiconductor products undergoing miniaturization, stacking and modularization. We will further advance our compression equipment to establish an unrivaled position and secure a unique competitive advantage. For transfer equipment, we will pursue customer satisfaction and expand market share by achieving shorter lead times and improving price competitiveness through use of the global supply chain. For singulation equipment, we will expand sales by visibly differentiating its functions from those of competitors and pursuing further improvements in quality, cost and delivery.」

「In the semiconductor manufacturing equipment business, we are developing next-generation equipment. To better meet customer requirements, we exhibited the next-generation compression equipment PMC2030, with improved thickness accuracy, at a private show held in South Korea in November 2017.」

「Transfer equipment is essential for camera modules used in smartphones, while compression molding technology is an essential process for packages undergoing miniaturization, stacking and modularization. By proposing our proprietary compression equipment using this process as the optimal solution for semiconductor devices used in a wide range of applications, we secured orders.」

「Against this backdrop, the TOWA Group worked to expand sales of its proprietary compression equipment as the only solution for molding advanced semiconductor packages undergoing increasing miniaturization, thinning and stacking.」

「For our existing businesses, we will promote joint development with IDMs, fabless manufacturers and foundries, and use compression technology to capture trends in advanced semiconductor packaging.」

「Against this backdrop, the TOWA Group worked to expand its molding equipment, which can handle not only conventional substrates but also wafer-level molding and panel molding through further advancement of its existing transfer technology and the use of its proprietary compression technology, as well as singulation equipment, which is used in the next process after molding.」

「For our existing businesses, we will promote joint development with fabless manufacturers and foundries, and use compression technology to capture trends in advanced semiconductor packaging.」