Global smartphone chipset shipments decline 5 per cent in Q1 2022, says Counterpoint Research

According to a report by Counterpoint Research, the global smartphone chipset market shipments, consisting of system-on–chip (SoC)/application processor (AP) and baseband, declined 5 per cent year-on-year in Q1 2022. The decline was driven by seasonality and weaker demand in China amid lockdowns.

However, as per the report, strong revenue growth of 23 per cent year-on-year in the quarter offset this decline, as the chipset mix shifted towards costlier 5G smartphones.

Taiwan Semiconductor Manufacturing Company (TSMC) held approximately 70 per cent share of the shipments, followed by Samsung Foundry capturing a share of 30 per cent.

Further, the report notes that TSMC-based smartphone chipsets declined 9 per cent annually in Q1 due to Qualcomm selecting Samsung Foundry for manufacturing the X60 baseband, coupled with an annual decline in the MediaTek smartphone chipset shipments.

Nonetheless, the report predicts that Qualcomm’s dual sourcing strategy will add more volumes to TSMC in 2022. Also, the ramp-up of the 4nm chipsets from Qualcomm, Apple and MediaTek will enable TSMC to further gain share in smartphone chipset in 2022.

According to the report, TSMC accounted for 65 per cent of the total smartphone chipsets on advanced nodes, that is, 4nm, 5nm, 6nm and 7nm. The company entered mas production for its 4nm process node with MediaTek’s Dimensity 9000 SoC in Q1 2022. TSMC’s 4nm node-based smartphone chipset shipments will further grow with Qualcomm’s dual sourcing strategy for its future 4nm-based Snapdragon 8+ Gen 1 SoC.

Meanwhile, according to Counterpoint Research, Samsung Foundry’s overall performance was driven by Qualcomm and Samsung Semiconductor’s internal Exynos chipset division. Despite relatively lower yield rates for the leading 4nm process node, Samsung Foundry led the leading nodes (4nm and 5nm) smartphone chipset shipments with a 60 per cent share, followed by TSMC which accounted for 40 per cent share in Q1 2022.

However, Samsung Foundry can face pressures due to uncertain global macroeconomic conditions, potential inventory corrections and dual-sourcing from Qualcomm.