GloFo now second biggest foundry business -

GlobalFoundries has overtaken United Microelectronics Corp (UMC) as the second biggest contract chip maker for the second quarter of 2012, reports IC Insights.

GloFo managed increase sales by 18 percent, pushing the company past UMC to become the second biggest foundry in the world. It is also ranked as the 16th largest semiconductor supplier, worldwide, and the analyst house believes it may climb over Fujitsu for total 2012 sales to reach 15th.

TSMC, unsurprisingly, is top dog by an enormous margin.

According to principal analyst at Future Horizons, Malcolm Penn, the figures are not exactly groundbreaking. Although IC Insights' research provides a nice line of spin for GlobalFoundries, Penn points out that UMC has "never made a penny out of its foundry business overall".

It is, according to Penn, difficult to see how UMC can keep raising money for what is essentially zero return on investment, "even in Taiwan, which is also struggling to find a solution for its obsolescent DRAM industry".

"GloFo is bleeding cash but with a mega-rich daddy who loves its protege to pieces and has a grand vision," Penn said. Spend equals capacity, and capacity means shipments, so if you don't have the capacity, you can't ship the product.

"GlobalFoundries has investment and Cap Ex spend," Penn said. "UMC does not".