In the second quarter of 2024, the semiconductor industry entered a full-scale uptrend. The Semiconductor Industry Association (SIA) reported that global semiconductor sales amounted to approximately $46.17 billion in February 2024, marking a year-over-year increase of 16.30% (up from 15.20% growth in the previous month), with a month-over-month decrease of 3.07% (down from a 2.12% decrease in the prior month). The slight month-over-month decline in semiconductor sales, influenced by seasonal factors, and the double-digit year-over-year growth, demonstrate that the semiconductor industry is in a moderate recovery phase.
In the wave of AI, new types of DRAM represented by HBM are facing new development opportunities. At the same time, driven by server demand, MRDIMM/MCRDIMM has become the new hot commodity in the memory industry.
According to a report by DRAMeXchange, the rapid development of AI and big data is driving an increase in server CPU cores. To meet the data throughput requirements of each core in multi-core CPUs, the bandwidth of the memory system needs to be significantly increased. Against this background, the HBM module MRDIMM/MCRDIMM for servers has emerged.
In terms of supply, SK Hynix and Micron are the main players in HBM modules, both indicating that they will start mass shipments in the second half of 2024. It is reported that memory giant Micron has announced the launch of a new MRDIMM DDR5, which is currently in the sample phase and will provide AI and HPC applications with ultra-large capacity, ultra-high bandwidth, and ultra-low latency.
Qualcomm’s latest chip aims to make 5G connectivity standard in some of the cheapest phones on the market. The Snapdragon 4S Gen 2 platform, announced on Tuesday, supports fast 40-watt wired charging and gaming for phones priced under $100. Qualcomm expects these lower-end phones to be released later this year, starting with a model from Xiaomi.
According to Carina Affinito, Qualcomm’s Staff Manager of Product Marketing, the new platform will enable gigabit 5G smartphones for under $99. The Snapdragon 4S Gen 2 targets a slightly lower tier than last year’s Snapdragon 4 Gen 2, providing another option for manufacturers of lower-cost devices.
Currently, some companies, like Samsung and TCL, use MediaTek processors in their sub-$200 5G-capable phones. Examples include the $200 Galaxy A15 5G and TCL’s 50 series, with prices ranging from $100 to $160, though these are often locked to a single US carrier.
Many phones under $150 still lack 5G connectivity, but the availability of chipsets like the 4S Gen 2 may help make this technology more widespread, even for budget-conscious consumers.
Kioxia, a major player in the Japanese NAND flash market, announced on August 1st the completion of the Fab2 (K2) building at its Kitakami Plant in Iwate Prefecture in July. The company is gearing up for a gradual capital investment as the demand for flash memory recovers, with operations at K2 expected to begin in the fall of 2025. A part of the investment for K2 is set to be subsidized by the Japanese government, as per an agreement reached in February 2024.
Originally, K2 was to start production in 2023, but due to a decline in the memory market and a drop in demand for NAND Flash in smartphones and PCs, Kioxia had to cut production by over 30% in October 2022 and postponed the facility’s launch. However, with market conditions improving, the company ceased production cuts in June 2024, and the production line is now operating at full capacity.
In collaboration with Western Digital, Kioxia is planning to invest a substantial 729 billion yen in the Yokkaichi and Kitakami plants, with up to 243 billion yen in subsidies from the Japanese government. The Kitakami plant will produce the state-of-the-art “8th generation” memory chips, with a monthly capacity of 25,000 wafers, catering to AI data centers, smartphones, PCs, and automotive applications.
Moreover, Kioxia is reportedly preparing for an initial public offering (IPO) on the Tokyo Stock Exchange, aiming to go public by the end of October, with the official application expected to be submitted by the end of August, as per a Reuters report citing industry sources.
The US government is preparing to curb the export of high-bandwidth memory (HBM) chips from the largest suppliers in the US and South Korea to Chinese companies, its latest move to limit China’s access to cutting-edge components, Bloomberg reported.
The news agency noted that restrictions, which could be put in place by next month, would cover advanced AI memory chips, including HBM2, HBM3, and HBM3E. The new curbs would hit SK Hynix, Samsung, and US-based Micron Technology, which account for the vast majority of global HBM output.
To keep up with soaring demand for memory chips driven by the AI boom, TrendForced reported in June Samsung and Micron are preparing to increase production capacity. Chinese Foreign Ministry spokesperson Lin Jian stated in a daily briefing it “firmly opposes” the move, which undermines international trade rules, and destabilizes global industrial and supply chains.
He added: “China will keep a close eye on relevant developments. We hope relevant countries will firmly resist the coercion.” The measure, if enacted, is expected to meet resistance from South Korean manufacturers. Following pressure from the South Korean government late last year, the US granted Samsung and SK Hynix new waivers on export controls, allowing them to move ahead with plans to acquire chipmaking equipment to expand operations in China.
Bloomberg reported the latest measure would be part of a broader package, including sanctions against more than 120 Chinese companies and new limits on US suppliers of chip equipment to the mainland. In March, the US encouraged the Netherlands, Germany, South Korea, and Japan to introduce chip restrictions on China as part of an effort to close export loopholes.
Apple is set to unveil the new iPhone 16 this fall, featuring integrated AI capabilities and an AI application called “Apple Intelligence,” which has garnered significant market attention. The industry widely expects that the launch of this new model could boost Apple’s stock price and trigger a new wave of device upgrades, benefiting semiconductor companies in the iPhone supply chain, such as TSMC and Qualcomm.
However, there are concerns about the stability of the AI features, and reports suggest that Apple may not include them in the initial release of iOS 18 in September, but instead plans to roll them out in an October update. This implies that the first shipments of the iPhone 16 might not have the new AI functionalities. Despite this, Apple is expected to release an iOS 18.1 beta 1 update for developers soon, allowing them early access to the Apple Intelligence service.
In addition to chip manufacturers, Foxconn, the largest supplier of iPhones, is also poised to benefit from the new iPhone release. Foxconn announced a substantial investment to expand its subsidiary’s factory in India late last year. The company will produce the iPhone 16 Pro and Pro Max models in India for the first time, marking a significant step in Apple’s increasing focus on the Indian market and supply chain. This move indicates Apple’s support for India to become another global iPhone production hub besides China.
