01. Power Semiconductor Inventory to Normalize in H2 2025, Growth to Begin in 2026
According to a report dated April 7, a survey by Fuji Keizai estimates that the global power semiconductor market will reach 7.771 trillion yen by 2035, a 2.3-fold increase from 2024. In 2024, the power semiconductor market experienced inventory accumulation due to factors including the slowdown in electric vehicle demand. However, as demand began to recover from the second half of 2024, the inventory is expected to normalize in the second half of 2025, and the market will start to expand from 2026. The power semiconductor market is projected to reach 3.5285 trillion yen in 2025, with the silicon power semiconductor segment accounting for 3.147 trillion yen, a relatively small increase.
02. Semiconductor Industry Faces Dual Challenges of Tariffs and Supply-Demand Imbalance; Strong AI Chip Demand Amid Lingering Concerns
The semiconductor industry is facing dual challenges of tariffs and supply-demand imbalance. The tariff issues between China and the US have raised concerns over demand, causing related stock prices to weaken, with particular worries about the contraction of end-consumption in computers, mobile phones, and other devices. However, DRAM and NAND flash memory prices have rebounded due to inventory adjustments and supply contraction, and the production cut effect in the second quarter is expected to drive up prices. But this price increase is partly due to companies' panic buying and stockpiling, not a real increase in demand. Samsung Electronics' first-quarter performance exceeded expectations, but its stock price did not get a boost.
AI semiconductor demand is strong, with TSMC's revenue in March surging 46.5% year-on-year. However, the industry as a whole is constrained by the soaring tariffs on China and supply chain risks. China is a key link in global semiconductor assembly, and high tariffs may lead smartphone OEMs to delay purchases, suppressing demand. The short-term memory price increase and AI growth have provided a temporary respite, but the uncertainty of tariff policies and weak end-demand remain long-term concerns.
03. Infineon to Acquire Marvell's Automotive Ethernet Business for $2.5 Billion
On April 7, Infineon announced that it will acquire Marvell's automotive Ethernet business for $2.5 billion in cash. The acquisition aims to strengthen Infineon's position in the automotive microcontroller market and enhance its system capabilities in the software-defined vehicle domain.
Marvell's automotive Ethernet business is expected to generate revenue of $225 million to $250 million in 2025, with a gross margin close to 60%. The business has over 50 automotive manufacturer customers, including eight of the top ten global automakers. After the acquisition, Infineon will leverage Marvell's Brightlane™ automotive Ethernet portfolio, which includes PHY transceivers, switches, and bridges that support network data rates from 100 Mbps to 10 Gbps.
04. Micron to Levy Surcharges on Some Memory Products from April 9 to Mitigate US Tariffs
On April 10, according to SemiMedia, Micron Technology will impose surcharges on some products starting from April 9 to cope with the new US tariff policy. Memory modules and solid-state drives (SSDs) will still be affected, which are widely used in automotive, notebook computers, and data center servers. Micron, with manufacturing bases in multiple locations in Asia, plans to pass on the additional costs to customers in the affected regions. Previously, Micron also notified customers of product price increases due to "unanticipated high demand".
On April 1, STMicroelectronics (ST) and Innoscience announced the signing of a development and manufacturing agreement for gallium nitride (GaN) technology. The collaboration aims to enhance the competitiveness and supply chain resilience of GaN power devices. Under the agreement, both companies will jointly advance GaN power technology and promote its applications in consumer electronics, data centers, automotive, and industrial power systems. Innoscience will utilize ST’s front-end manufacturing capacity in Europe to produce GaN wafers, while ST will leverage Innoscience’s manufacturing facilities in China to optimize the supply chain and expand market coverage.
05. Japans Sourcenext to Shift Production to Vietnam to Mitigate Tariff Impact
On April 9, Japanese electronics manufacturer Sourcenext announced plans to establish a new production base in Vietnam to counter the high tariffs imposed by the US on Chinese goods. Currently, Sourcenext's flagship product, the Pocketalk translation device, is manufactured in Shenzhen, China. The move to Vietnam is aimed at "minimizing the impact of tariff measures and maintaining reasonable pricing."
Sourcenext plans to start shipping Pocketalk devices from Vietnam in September. Since the company had already shipped a year's worth of inventory to the US in advance, the new tariff policy will not affect sales in 2025.
06.Reciprocal Tariffs Eased, Tech Industry Sees Surge in Urgent Orders
On April 11, the Economic Daily reported that US President Trump announced a 90-day suspension of reciprocal tariffs on trade partners other than Mainland China. This policy shift has led to a surge in urgent orders for some Taiwan-based industrial PC (IPC) and chip manufacturers, with clients requesting faster delivery timelines to take advantage of the 90-day tariff-free window.
Industrial PC manufacturer Aplextec said that previously, the additional tariffs negotiated with US clients were mainly at 32%, but recently some clients have requested early shipments, with the current tariff rate for shipments to the US being 10%, which clients generally find acceptable. Another IPC manufacturer also noted the possibility of early shipments due to the 90-day tariff suspension.
IC designers revealed that after Trump's announcement, some clients have expressed a desire to expedite orders within the 90-day period, which could boost second-quarter performance. However, some IC design firms expressed concern about the potential for sudden changes in the situation, saying they were both hopeful and apprehensive about the impact.
On the contract manufacturing side, Quanta, Wistron, and Inventec have not yet seen significant changes in client demand. Quanta stated that given the rapid changes in tariff policies, clients are continuously evaluating the situation, and the company is in close communication, working towards long-term solutions.