01. DRAM Suppliers Increase Prices by 8-10%
On April 23, driven by aggressive inventory stocking, the contract prices for DRAM and NAND Flash in the second quarter have seen a larger-than-expected increase. DRAM suppliers have raised spot prices by 8-10%. For example, the average spot price of mainstream chips such as DDR4 1Gx8 3200MT/s increased from $1.673 last week to $1.720 this week, a rise of 2.81%.
In contrast, NAND Flash spot prices remained flat due to a slowdown in demand. The spot price of 512 GB TLC wafers fell by 0.04% this week, to $2.764. TrendForce pointed out that this price increase is mainly due to the storage needs of U.S. brands that are sensitive to tariffs and manufacturers' export demands. The final direction of U.S. tariffs is expected to be a key indicator for supply-demand and price changes in the storage market in the second half of the year.
02. Industrial and Automotive Semiconductor Sectors Begin a Mild Recovery
On April 24, an institutional analysis indicated that while the market focuses on AI chips, the industrial and automotive chip sectors are quietly recovering. STMicroelectronics (ST) and Texas Instruments (TI), two veteran chip manufacturers, have reported better-than-expected revenues and are optimistic about the second half of 2025. ST expects its second-quarter revenue to increase by 7.7% quarter-over-quarter, reaching $2.71 billion, which is better than market expectations. TI's industrial business saw a high single-digit year-over-year increase in the first quarter, with total revenue up 11% year-over-year to $4.1 billion.
Both companies noted that customer inventories have reached low levels, making it the right time to replenish stocks. Despite the tense U.S.-China trade relations, neither company has observed any panic buying or rush to stock up due to tariffs, and both emphasized their highly resilient supply chains. Although the second quarter is expected to outperform the first, management from both companies stressed that visibility remains low, and it is too early to be overly optimistic.
03. STMicroelectronics Reports Bottoming-Out in Q1, Expects Sales Recovery in Q2
On April 24, European chipmaker STMicroelectronics announced that its first-quarter performance was in line with expectations and marked the low point for the year. The company expects sales to gradually recover in the second quarter. STMicroelectronics reported first-quarter revenue of $2.52 billion, which matched guidance and analyst expectations. The company forecast second-quarter revenue of $2.71 billion, down 16.2% year-over-year but higher than analyst estimates. STMicroelectronics did not provide full-year performance guidance, and its inventory days increased from 122 days in the fourth quarter of last year to 167 days.
04. Taiwan Firms on Alert, SK Hynix Warns of Poor Market Conditions in the Second Half
On April 25, South Korean memory giant SK Hynix reported better-than-expected quarterly results but warned that the market in the second half of the year may face demand fluctuations due to uncertainties surrounding U.S. tariff policies. Analysts remain cautious about the outlook, expecting a possible situation of "falling prices and volumes" in the second half. SK Hynix's net profit in the first quarter increased by 322% year-over-year but declined quarter-over-quarter, reflecting the impact of the traditional off-season. The company noted that uncertainties in tariff policies will affect the market in the second half, although the demand for AI servers is expected to be less affected, while consumer electronics demand may benefit from the launch of new products.
05. New U.S. Tariff Policies May Lead to Inventory Build-up Across the Entire Industry Chain
On April 22, TechInsights reported that the uncertainty of new U.S. tariff policies has had a significant impact on the semiconductor industry. Although semiconductors are currently exempt from tariffs, the related sectors have already felt the pressure. Three scenarios predict the following:
Base Case: Global GDP growth of 3.2%, with tariffs remaining at 10%. The industry outlook for the second half of 2025 is downgraded, and demand is front-loaded into the second quarter.
Moderate Impact: Global GDP growth of 2.2%, with the possibility of U.S.-China tariffs rising to 30%-40%. Inventory surges in the first half of 2025, while consumer electronics demand slows in the second half, with data center demand remaining stable.
Severe Impact: Global GDP drops to 1.2%, with U.S.-China tariffs exceeding 100%. Orders are front-loaded in the first half of 2025, while the U.S. and European economies enter recession in the second half. Electronics sales collapse, and demand for AI, HBM, and GPU declines, leading to significant inventory build-up.
06. Regionalization of the Semiconductor Industry Chain Intensifies, Accelerating Domestic Substitution for U.S. Firms
On April 22, the financial sector shared information that restrictions on H20 trade, combined with new domestic rules on the origin of chips, are creating opportunities for the domestic semiconductor industry. In 2024, the top 10 global semiconductor equipment suppliers generated revenues exceeding $110 billion, with U.S. firms holding nearly 45% of the market share, and their revenues are heavily dependent on the Chinese mainland market.
In the 2024 fiscal year, the three major U.S. semiconductor equipment suppliers generated sales exceeding $20 billion in the Chinese mainland. There is a broad potential for domestic semiconductor equipment substitution, and domestic players have already developed the capability to replace most processes in mature technologies. They are also expected to accelerate substitution in advanced technologies.