Fairchild Semiconductor International is hardly a babe in the woods when it comes to making chips. One of the world's oldest chip companies, Fairchild makes semiconductors for tens of thousands of customers in the automotive, computer, consumer electronics, industrial, mobile, and communications markets. Its diversified product line includes logic chips, discrete power and signal components, optoelectronics, and many types of analog and mixed-signal chips. The company subcontracts a small amount of its fabrication, assembly, and test operations to companies that include TSMC, Amkor, and ASE, among others.
Fairchild Semiconductor International gets three-quarters of sales from customers in Asia/Pacific. Its manufacturing facilities are located in China, Malaysia, the Philippines, South Korea, Taiwan, and the US.
Overall sales for Fairchild in 2011 were down slightly to $1.6 billion, which the company attributed to a 13% decrease in unit volumes sold offset by 12% increase in average selling prices. Geographically, sales in South Korea fell on weakness in the LCD and plasma TV market while sales in other Asia/Pacific countries benefited from a strong mobile business in Singapore and increased demand for industrial electronics in Japan. The company reported profits for the second consecutive year, though net income fell 5% primarily due to the lower revenues and higher expenses related to commodity prices, labor costs, and the conversion to 8-inch wafers. Fairchild returned to profitability in 2010 after the industry struggled through the combination of a down cycle for the global semiconductor sector combined with the economic downturn in 2008 and 2009.
To control costs, the company continues to streamline its operations, including headcount reductions, plant consolidations, and inventory adjustments. Fairchild announced plans in 2009 to close its wafer fabrication plant (fab) in Mountaintop, Pennsylvania, at the end of 2012. That decision was reversed in 2011 on strong demand for the automotive and high-voltage products manufactured. In addition, the company transferred production of its four-inch wafer fab line in South Korea to other lines in the facility; larger-diameter silicon wafers can accommodate more chips per wafer, making fabrication more efficient.
Fairchild's inventions sparked the mass production of integrated circuits in the 1950s. Acquisitions, including the power semiconductor operations of Samsung Electronics and Intersil, boosted the company's product line to more than 10,000 devices, including key components found in most electronic systems. Fairchild continues to introduce hundreds of its own designs each year. Its "building block" approach allows it to customize basic designs, cutting development costs and time to market. – less