01. TSMC’s sales growth slows as UMC’s sales decline
Sales at leading foundry TSMC in January grew year-on-year but at a lower rate than in previous months, while fellow Taiwanese foundry UMC saw its January sales decline both sequentially and year-on-year.
In January TSMC achieved sales of NT$200.05 billion (about US$6.65 billion) up 16.2 percent compared with the same month a year before and up 3.9 percent sequentially. In December 2022 TSMC was running 23.9 percent ahead of year before and in November and October the company reported 50-plus percent annual growth.
UMC’s January sales were NT$19.59 billion (about US$650 million) down 6.5 percent sequentially and down 4.3 percent year-on-year.
The sales could signify that UMC and TSMC are starting to experience a slowdown in demand that has already hit other semiconductor makers. The downturn is expected to bottom out sometime during 2H23.
02. AMD CEO Says It’s Limiting Supply of CPUs and GPUs to Maintain High Prices
According to remarks noted by PCGamer, Dr. Su says it’s been limiting supply and will continue to do so. “We have been undershipping the sell-through or consumption for the last two quarters,” said AMD’s CEO. “We undershipped in Q3, we undershipped in Q4. We will undership, to a lesser extent, in Q1.”
It’s an interesting admission that explains why CPU and GPU prices haven’t crashed along with the PC market. It makes us wonder if Nvidia is doing something similar. Although some decent deals on GPUs appeared a few months ago before AMD and Nvidia launched new architectures, those deals have now vanished.
Instead of it being a buyer’s market, prices are still surprisingly high given the low demand for GPUs and CPUs currently. Both companies have also launched new products that are more expensive than their previous-gen products, despite the current economic situation. This seems to imply hardware prices will never “return to normal” in the future. Instead, this is the new normal.
03. Chip purchase spending by the world's top ten OEMs decreased by 7.6% in 2022 compared to 2021
Feb. 8, 2023, According to Gartner's latest report, the chip procurement spending of the world's top ten original equipment manufacturers (OEMs) decreased by 7.6% in 2022, accounting for 37.2% of the entire market.
Masatsune Yamaji, senior director analyst at Gartner, said that in 2022, inflation and recessionary pressures have significantly weakened demand for PCs and smartphones, affecting the production of global OEMs, resulting in the inability of major OEMs to increase unit production and shipments.
Additionally, semiconductor shortages persist in the automotive, networking, and industrial electronics markets, raising chip average selling prices (ASPs) and accelerating semiconductor revenue growth in these markets. The above factors have led to a decline in the share of head OEMs in the total semiconductor spending for the entire year of 2022 compared to 2021.
Chip purchase spending by the world's top ten OEMs decreased by 7.6% in 2022 compared to 2021-SemiMedia
Apple tops the list of top ten chip buyers for the fourth consecutive year, spending $67.01 billion on chip purchases in 2022, accounting for 11.1% of the market in 2022; Samsung Electronics increased chip purchase spending by 2.2%, ranking second; Sony had the fastest growth in chip purchase spending in 2022, up 16.5%.
It is worth noting that Huawei’s chip procurement expenditure in 2022 was $12.01 billion, a decrease of 19.4% from 2021, ranking seventh among the top ten buyers of semiconductors.
04. Insiders: Amkor Shanghai to suspend production for a week
Feb. 10, 2023, According to the supply chain, semiconductor product packaging and test services provider Amkor Shanghai's production line will be suspended for a week from February 27 to March 6 due to insufficient orders.
The services provided by Amkor Shanghai include a complete set of solutions including wafer needle testing, packaging, testing, bumping and designated delivery, and its customers include the world's top chip manufacturers.
For the suspension of production, industry insiders pointed out that it is because of the decline in semiconductor orders, which is related to the general environment of the global semiconductor industry.
05. Supply Chain: Microchip plans to raise prices
Feb. 8, 2023, According to the supply chain, Microchip plans to raise prices by about 5% in March this year.
The source revealed that due to the impact of the prices of raw material suppliers and foundries, Microchip's production costs continued to increase, and the company had to pass some of the costs on to customers, and will increase the prices of multiple product lines by about 5% from March 1, 2023.
The source further pointed out that Microchip did not issue a price increase notice letter for the price increase as before, and did not disclose the specific product price, but the price increase will be open to all customers.
06. Infineon: Automotive MCUs shortage is expected to ease in the second half of the year
Feb. 7, 2023, Infineon said recently that the automotive MCU shortage is expected to ease in the second half of 2023.
Infineon pointed out that demand for semiconductors in the automotive, renewable energy and security sectors remained strong, but there was a cyclical slowdown in demand for consumer products and weak business spending on IT infrastructure.
According to Infineon, with the continuous development of electric vehicles and ADAS, customers are now more willing to sign capacity reservation agreements or place longer commitment orders to ensure semiconductor supply.
To meet such demands, Infineon is increasing production rates to nearly 1 million units per day. The company revealed that the production capacity of automotive products for fiscal year 2023 has been fully booked.
07. DRAM modules and DIMM chipsets boosted by DDR5 technology, says Yole
After an abrupt decline in 2019 followed by two positive years in 2020 and 2021, the DRAM market rapidly entered a new downward phase in the second half of 2022, according to France-based Yole Intelligence, part of Yole Group.
According to Yole, multiple factors, including geopolitical tensions and global inflation have weakened DRAM-bit demand, accelerating the shift into oversupply. As a significant segment of the DRAM market, DRAM modules are not spared from such macro trends.
"For 2022, we estimate a -36% YoY decline in the PC-module market, which decreased from ~US$10.3 billion in 2021 to ~US$6.6 billion in 2022," according to Diego Alfaro, an analyst from the Semiconductor & Software division at Yole Intelligence.
"For server modules, the market dynamics are better. We estimate a moderate YoY revenue growth of 0.4% to ~US$33.1 billion in 2022. The total DRAM-module market will increase from ~US$42 billion in 2022 to ~US$96.3 billion in 2028, with a CAGR22-28 of ~16%. This increase is mainly due to the impressive growth of server modules," said Alfaro.