Chip market to turn up in 2Q23, says SEMI
The contraction of the global chip market is going to “moderate” in 2Q23 with a gradual recovery starting in 3Q23, according to industry body SEMI.
SEMI said it expects both IC sales and shipments to show quarter-on-quarter “improvements” in 2Q23 partly due to seasonal trends,
Whether those improvements are increased sales or a slowing of the market contraction was not made clear. Elsewhere SEMI spoke of the current downturn hitting bottom in the second quarter of 2023 implying 2Q23 would be a quarter of sequential market decline.
A quarter-on-quarter improvement is the opposite of what is foreseen by market analyst Malcolm Penn who sees continued contraction in 2Q23 and sub-seasonal sequential growth in 3Q23 (see Global chip market still headed for 20% decline in 2023, says Penn).
In its 1Q23 Semiconductor Manufacturing Monitor (SMM) report. SEMI comments that despite its forecast for 2Q23, silicon shipments and fab utilization rates remain much lower than they were a year ago. SEMI’s forecast is the more suprising because global fab utilization is due to dip to just over 70 percent in 2Q23 while the inventory burn off appears to dropping much less quickly.
Total IC inventory versus fab utilization. Source: SEMI.
Wafers that are not being processed in 1H23 cannot turn into sales in 2H23!
Nonetheless, SEMI reckons the indicators point to a bottoming of the current downturn in the second quarter of 2023 with a slow recovery expected to begin in the year’s second half.
“The current market downturn is compounded by soft consumer demand and elevated inventory levels and has led to a sharp decline in semiconductor fab utilization,” said Clark Tseng, senior director of market intelligence at SEMI, in a statement. “However, as the inventory correction comes to an end in mid-2023, a mild recovery is expected in the second half of the year driven by a pickup in demand for inventory and the holiday season.”
“Despite ongoing uncertainties and risks, we expect continuing production cuts and capex reductions, especially in the memory market, will start having a positive impact on market fundamentals in the latter part of the year, resulting in a more balanced market environment,” said Risto Puhakka, vice president of market analysis at TechInsights.
The SMM report is prepared by SEMI in partnership with TechInsights and costs $1,100 to members and $1,500 to non-members.
Related links and articles:
News articles:
Memory prices expected to fall further in 2Q23
Global chip market still headed for 20% decline in 2023, says Penn
Global chip market to decline 11% in 2023, says Gartner
If you enjoyed this article, you will like the following ones: don't miss them by subscribing to :
