Top 10 OSAT (Outsourced Semiconductor Assembly and Test) Companies

Ⅰ The flow of semiconductor assembly and test

The semiconductor assembly and test process flow is: the wafer from the wafer pre-process is cut into small wafers (Die) through the scribing process, and then the cut wafer is mounted with glue onto the corresponding substrate (lead frame) frame island. And then the wafer's bond pad is connected to the corresponding lead of the substrate using ultra-fine metal (gold, tin, copper, aluminum) wires or conductive resin. After sealing, a series of operations are performed, such as Post Mold Cure, Trim&Form, Plating, and Printing.

After the packaging is completed, the finished product is tested, usually through Incoming, Test, and Packing processes, and finally warehoused for shipment. A typical packaging process is scribing, assembly, bonding, plastic sealing, debonding, plating, printing, ribbing and molding, inspection, testing, and packaging.

Semiconductor devices have many package forms, which can be classified into three categories: pin insertion type, surface mount type, and advanced package according to the shape, size, and structure of the package. From DIP, SOP, QFP, PGA, BGA to CSP, and then SIP, the technical indexes are more advanced than the previous generation.

In general, semiconductor packaging has experienced three major innovations: the first was in the 1980s from pin-in package to surface-mount package, which greatly improved the assembly density on printed circuit boards. The second was in the 1990s with the emergence of the ball matrix package, which met the market demand for high pins and improved the performance of semiconductor devices. Chip-level package, system package, etc. are the third innovation, the purpose of which is to reduce the packaging area to the minimum.

Ⅱ Revenue of global OSAT companies 2020-2021

OSAT stands for Outsourced Semiconductor Assembly and Test. The overall revenue of OSAT semiconductor assembly and test in 2020 grows 12.36% from 2019, exceeding 329 billion $ to reach 335 billion $; among which the revenue of the top 10 reaches 281 billion $, up 12.87% from 249 billion $ in 2019.

The biggest change in the ranking in 2020 is that the revenue of Tongfom Microelectronics exceeded RMB 10 billion, sitting at the position of the world's fifth position, and also consolidating the position of China's second-largest OSAT company.

The second change is that United Technologies slips to No.10 from No.8 in 2019. In 2020, United Technologies is acquired by Smart Road Capital and plans to set up factories in Shanghai and Yantai, Shandong.

Top 10 global OSAT companies in 2020 (Unit: RMB million)

The top 10 OSAT companies in 2020 are unchanged from 2019, but industry concentration further increases in 2019, with the top 10 packaging and testing companies accounting for 84% of OSAT revenue, up 0.4 percentage points from 83.6% in 2019.

Among the top 10 Semiconductor Assembly and Test companies based on headquarters location, there are five in Taiwan, China (Sunrise ASE, Powertech PTI, KYEC, Namco ChipMOS, Chipbond Chipbond), with a market share of 46.26%, up 2.3 percentage points from 43.9% in 2019; three in mainland China (Changdian JCET, Tongfu Microelectronics TFMC, Huatian Technology HUATIAN), with a market share of 20.94%, up 0.84 percentage points from 20.1% in 2018; one in the United States (Amkor), with a market share of 14.62%, and flat compared to 2018; and one in Singapore (United Technologies UTAC), with a market share of 2.15%, down 0.45 percentage points from 2.6% in 2019.

Of the top 10 in 2020, all nine have grown to vary degrees, except for United Technologies, with seven companies growing at double-digit rates. The top three growth rates are respectively, TFMC (30.46%), JCET Technology (19.09%), and PTI (14.85%).

Revenue ranking of the top ten OSAT companies in the world in the first three quarters of 2021 (Unit: US$ million)

Global revenue of the top 10 OSAT companies reached USD 8.89 billion in Q3 2021, up 31.6% YOY.

As global vaccine coverage increases and borders in Europe and the US gradually open, social mobility begins to recover and consumer products welcome the traditional peak season in the second half of the year. However, the supply chain is affected by shipping delays, high freight costs, and long and short term materials, and some parts prices have increased at a high rate in the first half of the year, making the second half of the year a weak season for the end market under the pressure of both rising manufacturing costs and prices. However, the overall demand for cell phones, notebooks, LCDs, and other shipments still outperformed the second quarter, pushing up the performance of packaging and testing plants.

Among them, ASE and Amkor ranked the top two with revenue of USD 2.15 billion and USD 1.68 billion respectively, up 41.3% and 24.2% year-on-year respectively.

Ⅲ An overview of the top 10 OSAT companies

1 ASE

Headquartered in Kaohsiung, Taiwan, China, ASE was founded in 1984 by the Chang Songren brothers and is the world's largest provider of outsourced semiconductor assembly and test manufacturing services, with a 30% market share.

ASE provides semiconductor assembly and test services to over 90% of the world's electronics companies. Packaging services include fan-out wafer-level packaging (FO-WLP), wafer-level chip-level packaging (WL-CSP), flip-chip, 2.5D and 3D packaging, system-in-package (SiP), and copper lead bonding.

The company's main operations are in Kaohsiung, Taiwan, China, with other plants located in China, Korea, Japan, Malaysia, and Singapore. It also has offices and service centers in China, Korea, Japan, Singapore, Belgium, and the United States.

2 Amkor

Amkor, the world's second-largest IC vendor with a 14.6% market share, is headquartered in West Chester, Pennsylvania, USA, and was founded in 1968. Amkor offers a full suite of packaging services, including package design and development, wafer probing and package testing, wafer ramp and redistribution services, assembly, and final tests. Notably, Amcor is quite competitive in chip assembly by thermal compression and wafer-level packaging.

In 2016, Amcor fully acquired J-Devices Corp., the largest semiconductor assembly and test outsourcing provider in Japan, and in 2017, Amcor acquired NANIUM S.A.to strengthen the company's strength in semiconductor assembly and test outsourcing business, among others.

Amcor has factories in China, Japan, Korea, Malaysia, Philippines, Portugal, and Taiwan.

3 JCET

JCET, the largest OSAT company in mainland China and the third-largest in the world with an 11.9% market share, was established in 1972.JCET provides a full range of chip integration one-stop services, including IC system integration package design, technology development, product certification, wafer in-process testing, Wafer Bumping, finished chip testing.

In 2015, CST acquired Singapore's StarTech Goldpac. After the merger, JCET has 7 production bases and 6 R&D centers in China, Singapore, Korea, and the US, each with a clear positioning: Singapore base is responsible for eWLB high-end packaging and testing, Korea base is mainly for SiP system integration, Suqian and Chuzhou are positioned as low-cost production bases for discrete devices, and the headquarters is a production base for mid-to-high-end products.

4 PTI

PTI is a Taiwan-based semiconductor assembly and test manufacturing service company founded in 1997.

The company provides thin small form factor package (TSOP) IC package, quad flat leadless (QFN) package, multi-chip package (MCP), stacked multi-chip package (SMCP), ball grid array (BGA) IC package, and package on package (POP) assembly services and memory card package services, the company also provides IC testing services and wafer testing services.

The company operates primarily in Asia, Europe, and the Americas.

5 TFMC

Founded in 1997, TFMC specializes in IC packaging and testing. The company currently has packaging technologies including Bumping, WLCSP, FC, BGA, SiP, and other advanced packaging and testing technologies, QFN, QFP, SO, and other traditional packaging technologies and automotive electronics, MEMS, and other packaging technologies. Testing technologies include wafer testing, system testing, etc.

In 2016, TFMC, together with the National IC Industry Investment Fund, spent USD 371 million to acquire 85% of each of AMD Suzhou and AMD Penang, realizing the development mode of "joint venture + cooperation" with AMD, cutting into AMD's supply chain and improving a large part of the packaging and testing technology.

6 Huatian Technology

Huatian Technology, together with the above-mentioned JCET and TFMC, is known as the three giants of OSAT in mainland China.

Founded in 2003, HUATIAN's main business is the packaging and testing of integrated circuits. In December 2014, it signed a Shareholders' Equity Sale and Purchase Agreement with FCI and completed the equity delivery in 2015.

The packaging and testing products under the company have 12 series and more than 200 varieties, and the annual packaging capacity of ICs reaches 10 billion blocks. It has more than 1,800 employees, more than 680 technicians of various types, more than 2,000 sets of various equipment, and total assets of 600 million RMB.

7 KYEC

KYEC, headquartered in Hsinchu, Taiwan, China, was established in 1987 and is engaged in the back-end packaging and testing business of the semiconductor industry. Service areas include wafer pin testing (about 43%), finished IC testing (about 50%) and wafer grinding/cutting/die picking (about 7%), etc.

8 ChipMOS

Established in 1997, ChipMOS is a leading OSAT company, among which LCD driver IC packaging and testing capacity is ranked second in the world.

The company's main business is to provide services in packaging and test of high-frequency and high-density memory products and communication ICs in IC semiconductor back-end process, and its service targets include semiconductor design companies, integrated component manufacturing companies, and semiconductor wafer fabs.

9 Chipbond

Founded in 1997 and headquartered in Hsinchu, Taiwan, China, Chipbond is engaged in the manufacturing of driver IC products with business activities including gold, solder, and copper bumping, redistribution layers, wafer surface treatment, wafer grinding and dicing, and packaging and testing services.

Chipbond has two operating facilities in the Hsinchu Science Park, the LiHsin facility and the Prosperity facility. Wafer bumping is performed at the LiHsin facility, while the subsequent back-end processing (e.g. testing, dicing, and packaging) is performed at the Prosperity facility.

10 UTAC

UTAC, founded in 2010, is a leading global IC packaging and testing company. UTAC mainly focuses on the automotive, industrial control, cloud computing, and communication fields, focusing on technology development in the field of analog power devices, digital-analog hybrid devices, and sensors, especially in the field of automotive electronics packaging, which is ranked among the top three in the world.

In 2014, United Technologies acquired Panasonic's three packaging plants in Indonesia, Malaysia, and Singapore.

In August 2020, UTAC was successfully acquired by Smart Road Capital.