01. Arm Plans 300% Price Hike and In-House Chip Production
According to a Reuters report from San Francisco on January 13, chip technology supplier Arm Holdings (O9Ty.F) is devising a long-term strategy to increase prices by up to 300% and has discussed taking actions to compete with its largest customers. Despite Arm's key role in the rise of smartphones and energy-efficient data center chips, its size remains relatively small compared to its customers, with a revenue of $3.23 billion in the 2024 fiscal year. In that same period, Apple's revenue from hardware products powered by Arm-based chips was over 90 times larger than Arm's.
02. AI Infrastructure to Dominate MLCC Demand in 2025
The US economy outperformed expectations at the end of 2024, but high interest rates in 2025 may suppress spending and investment. TrendForce forecasts that MLCC shipments will decline by 3% quarter-on-quarter to 114.67 billion units in the first quarter of 2025. The strong US economy in December 2024 is likely to reduce the frequency of interest rate cuts by the Federal Reserve in 2025, prolonging high interest rates. Brands such as Dell and HP are accelerating educational notebook contracts in the second half of 2024 to prepare for potential tariffs starting in January 2025. ODMs like Compal are required to ship orders before the second half of 2024. On January 15, TrendForce reported that MLCC suppliers saw a surge in demand at the beginning of the year, driven by orders from Foxconn and others for GB200, as well as inventory ahead of the Lunar New Year, which boosted MLCC shipments at the start of 2025.
03. Infineon to Build New Power Module Base in Thailand
On January 15, Infineon will build a new semiconductor backend production base in Samut Prakan, southern Bangkok, Thailand, focusing on power module production. The new base aims to optimize and diversify its manufacturing operations, with support from the Thailand Board of Investment (BOI). The first building is expected to start operations in early 2026, and subsequent capacity expansion will be managed flexibly based on market demand. All expenditures related to the project in 2025 have been included in the company’s capital expenditure forecast.
Infineon’s Chief Operating Officer, Rutger Wijburg, stated that building an advanced backend wafer plant in Thailand is a key strategic step to meet future customer needs and enhance supply chain resilience. The new base will operate efficiently, resiliently, and with high quality, ensuring reliable delivery of high-quality products. This move will also support the expansion of Infineon’s frontend production capacity.
04. Wolfspeed to Close Texas Facility and Focus on SiC Wafer Production
On January 16, according to a report by SemiMedia, Wolfspeed announced the closure of its facility in Farmers Branch, Texas, and plans to put it up for sale. The 26-acre site includes four buildings, featuring a 14-megawatt data center that can be expanded to 28 megawatts, as well as a 162,500-square-foot semiconductor factory equipped with laboratories, workshops, and office space. The closure will result in the layoff of 75 employees, with production expected to cease shortly.
This decision aligns with Wolfspeed’s strategy to streamline operations and focus on 200mm silicon carbide (SiC) wafer production, in response to the declining demand for 150mm wafers. Additionally, Wolfspeed has indefinitely suspended its plans to build a new factory in Saarland, Germany. Instead, the company has secured $750 million in funding from the US Department of Commerce under the CHIPS Act. These funds will support the construction of new facilities in North Carolina and New York, and the relocation of its main power device manufacturing to New York.
05. Data Center Components and Semiconductor Costs to Rise Amid Supply Constraints
On January 16, Moody's, a global credit rating agency, released a report stating that the cost of key data center components is expected to rise further due to ongoing global supply constraints. Driven by the rapid growth of artificial intelligence, cloud computing, and data storage services, demand for data centers is projected to increase in 2025.
New colocation data centers are being developed to meet the needs of small and medium-sized tenants, who typically pay higher rental fees per kilowatt per month. Although vacancy rates in some markets may briefly rise slightly with the addition of new capacity, supply constraints are likely to keep vacancy rates low in the long term. To meet this surge in demand, developers are taking on more debt to build and upgrade data centers. Hyperscale companies such as Microsoft, AWS, Google, Meta, and Oracle are rapidly expanding their infrastructure globally, including in emerging and smaller markets.
06. Second-Gen OnePlus Tablet Upgrades to Qualcomm Chip, Gets a Price Bump
OnePlus has launched its second-generation Android tablet, the OnePlus Pad 2, which features a significant upgrade from the MediaTek Dimensity 9000 processor used in the previous model. The new tablet now incorporates Qualcomm’s latest Snapdragon 8 Gen 3 chip, a leading-edge technology also found in many flagship smartphones.
This upgrade aims to address the main criticism of the first-generation tablet, which was its relatively slower performance due to the MediaTek processor. However, the enhanced performance comes at a higher price. The OnePlus Pad 2 will cost $70 more than its predecessor.