01. Samsung, SK Hynix and Micron reduce investment in NAND Flash
With the rapid growth of profits contributed by HBM high-priced products, production capacity squeeze and industry supply and demand improvement have been driven, and memory manufacturers will gradually restart capital expenditures for investment in 2024.
The industry initially estimated that the three major memory suppliers focus on HBM and high-priced DRAM. Despite the strong demand for enterprise-level storage, the NAND Flash market still has oversupply concerns. Compared with the past two years, Samsung Electronics, SK Hynix and Micron's NAND Flash capital investment this year has decreased instead of increased.
NAND Flash prices have risen quarter by quarter, and the production capacity of various manufacturers in the second half of the year has fully returned to normal levels, but the market estimates that NAND Flash may be slightly oversupplied in the third quarter, and the price increase of NAND Flash will also be flat.
02. TI shows strong consumer analog IC demand in 2Q24
July 26, According to the latest financial report of Texas Instruments (TI), its second-quarter profit exceeded analysts' expectations, thanks to the stabilization of demand for analog chips in markets such as personal electronics and the decline in manufacturing costs. The rebound in sales of smartphones and personal computers has enabled companies to clear out excess inventory caused by hoarding during the epidemic, thus restoring purchasing demand.
Texas Instruments CEO Haviv Ilan said that Chinese electronics manufacturers have completed the consumption of component inventories, and as the largest market for semiconductors, it has resumed growth, with a month-on-month increase of 20%. Haviv Ilan said that Europe and Japan are still in the early stages of this process. He said that in the company's industrial sector, about half of the markets are still digesting inventories, while other markets have resumed order growth.
03. ST cuts 2024 outlook as industrial and automotive demand slows
After reporting a 25% year-on-year revenue decline in the second quarter, STMicroelectronics has revised its sales outlook for 2024 downward for the second time.
ST reported revenue of US$3.23 billion for the second quarter of 2024, down 6.7% sequentially and 25.3% year on year, with gross margin falling to 40.1% from 41.7% in the previous quarter and 49.0% during the same time in 2023. The operating margin for the quarter dropped to 11.6%, down from 15.9% in the first quarter and 26.5% a year ago.
"Second-quarter net revenues were above the midpoint of our business outlook range driven by higher revenues in Personal Electronics, partially offset by lower than expected revenues in Automotive. Gross margin was in line with expectations," said Jean-Marc Chery, ST president and CEO.
04. NXP's automotive chip revenue fell 7% in 2Q24
July 24, 2024, According to NXP, its second-quarter revenue fell 5% to $3.13 billion. NXP stated that sales of its largest division, automotive chips, fell 7% year-on-year to $1.728 billion, while revenue from industrial and IoT chips increased 7% year-on-year to $616 million; mobile chip revenue increased 21% year-on-year to $345 million; and revenue from communications infrastructure and other products decreased 23% year-on-year to $438 million.
"We will continue to manage the things we can control to position NXP to deliver strong profitability and earnings in a challenging demand environment," NXP CEO Kurt Sievers said in a statement.
05. SK Hynix’s Q2 Profits Reach Six-Year High
SK Hynix announced second-quarter revenue of 16.42 trillion Korean won, a 125% year-on-year increase, setting a historical record.
At the same time, profits reached their highest level since 2018. This was mainly due to strong demand for AI memory, including HBM, and overall price increases for DRAM and NAND products. AI storage products such as HBM and eSSD are thriving, with NAND turning a profit for two consecutive quarters.
As a key HBM supplier for Nvidia, SK Hynix’s HBM revenue surged by over 250%. The company stated in May that HBM capacity is almost sold out until 2025. With HBM’s growing importance in AI investment, SK Hynix plans to start mass production of 12-layer HBM3E products in the third quarter, solidifying its leadership in the HBM market.