02 Aug 2016
TOKYO, Japan, August 2, 2016—With an aim to concentrate its resources on focus domains of the compound device business, Renesas Electronics Corporation (TSE: 6723), a premier supplier of advanced semiconductor solutions, today announced that it will withdraw from the microwave semiconductor device business and focus on optoelectronics devices (photocouplers, laser diodes, and photodiodes) among the compound device business.
1. Reasons to the withdrawal from the microwave semiconductor device business
Renesas has been working to boost the performance of the compound device business by developing new products while implementing various measures including reducing manufacturing cost and promoting development efficiency.
Nevertheless, among Renesas’ compound device business it is anticipated that moving forward it will become increasingly difficult for Renesas to maintain profitability in the microwave semiconductor device segment due to factors such as shrinking size of the market as a result of the incorporation of peripheral component functionality into system-on-chip (SoC) devices as well as falling prices caused by the emergence of competing device manufacturers, particularly in Taiwan.
On the other hand, aside from microwave semiconductor devices, the optoelectronics segment of the compound device business is showing improved business performance due to the effects of manufacturing-related structural reforms and continuing strong market growth.
In light of this situation, as a measure to further strengthen the compound device business, Renesas intends to withdraw from the microwave semiconductor device business in order to focus on optoelectronics devices.
With regard to the optoelectronics device segment Renesas will continue to focus on highly reliable photocouplers for industrial applications while expanding its business by accelerating development of high-speed laser diodes and photodiodes for optical communication applications to accommodate the rapidly growing data transfer capacity required by data centers and base stations due to factors such as the popularization of smartphones. In addition, Renesas will continue to work on its Business Continuity Management (BCM) to maintain its system for ensuring consistent and stable supply of products.
2. Outline of the business activities to be discontinued
Renesas will discontinue development and production of microwave semiconductor devices.
- Renesas no longer plans to develop microwave semiconductor devices.
- Renesas plans to discontinue production and supply of microwave semiconductor devices already in mass production within approximately two years, following consultation with customers.
3. Future Outlook
The withdrawal from the microwave semiconductor device business will not have a material impact on Renesas’ consolidated financial results for the first quarter of the fiscal year ending December 31, 2016.
The statements in this press release with respect to the plans, strategies and financial outlook of Renesas Electronics and its consolidated subsidiaries (collectively “we”) are forward-looking statements involving risks and uncertainties. We caution you in advance that actual results may differ materially from such forward-looking statements due to several important factors including, but not limited to, general economic conditions in our markets, which are primarily Japan, North America, Asia, and Europe; demand for, and competitive pricing pressure on, products and services in the marketplace; ability to continue to win acceptance of products and services in these highly competitive markets; and fluctuations in currency exchange rates, particularly between the yen and the U.S. dollar. Amongst other factors, downturn of the world economy; deteriorating financial conditions in world markets, or deterioration in domestic and overseas stock markets may cause actual results to differ from the projected results forecast.
About Renesas Electronics Corporation
Renesas Electronics Corporation (TSE: 6723) delivers trusted embedded design innovation with complete semiconductor solutions that enable billions of connected, intelligent devices to enhance the way people work and live—securely and safely. A global leader in microcontrollers, analog, power and SoC products and integrated platforms, Renesas provides the expertise, quality, and comprehensive solutions for a broad range of Automotive, Industrial, Home Electronics, Office Automation and Information Communication Technology applications to help shape a limitless future. Learn more at renesas.com.