Panasonic ceases semiconductor production

News that Panasonic is selling off its semiconductor division comes as no big surprise, but it is indicative of just how tough business has become in the world of big tech.

Panasonic Semiconductor, the division of Panasonic that designs and fabricates its sensors, has been losing money for years. With more and more camera manufacturers adopting Sony sensors, competing with Sony has become ever more difficult and costly. Since Sony is also a camera manufacturer, its own cameras get access to its newest sensors before anyone else.

On top of that, Sony’s market share is startling; it accounts for around 70% of smartphone sensors and 50% of camera sensors, including the top end medium format camera systems even though one of them, Fuji, also makes image sensors.

With revenues of around $842 million and a loss of $215 million, it’s easy to see why Panasonic is selling off Panasonic Semiconductor, especially in light of Sony’s $2 BILLION investment in its own semiconductor division.

There was a lot of speculation that Panasonic adopting a Sony sensor in its S1 series or mirrorless cameras was a sign that the writing was on the wall for Panasonic’s image sensor business, and it seems that was in fact that case. Panasonic also cites the trade war between the US and China as a contributing factor, saying that the war has lead to lower demand for its products.

And so after 57 years of being in the sensor business, Panasonic is selling off its semiconductor division to Nuvoton Technology of Taiwan, foundry that makes integrated circuits such as microcontrollers, controllers, solid state amplifiers, and custom ARM processors. It’s a supplier for companies like HP and Dell.

As part of the sale, Panasonic is also withdrawing from its partnership with the custom semiconductor manufacturer TowerJazz, who says that ending the partnership with Panasonic will not affect its foundry customers.

According to the Nikkei Asian Review, Panasonic is also planning to divest its LCD business in 2021 due to ongoing losses there.

HT to Petapixel.