A collapse of the market for memory chips has led semiconductor analyst IC Insights has downgraded its worldwide IC growth forecast for 2022 to 7 percent from 11 percent.

IC Insights described the memory market as being in “free fall” and said that as a result Samsung will drop to second place and Intel to third as foundry TSMC is lifted to top position in a 3Q22 ranking.

Memory chip companies have attributed a swift downturn in sales to an inventory adjustment at customers that is expected to last at least until early 2023. IC Insights observed that Micron Technology is predicting a 21 percent drop in sequential quarterly sales. Western Digital is forecasting an 18 percent drop.

Taiwan-based Nanya reported August 2022 DRAM sales down 53 percent from March 2022 and down 39 percent from August 2021.

Forecast top three semiconductor sales leaders in 3Q22. Source: IC Insights.

In 2021 foundry TSMC was ranked by IC Insights as the third largest semiconductor supplier with 31 percent less sales than rival Samsung that spans foundry memory sales. In 3Q22 Intel’s chip sales are expected to be 26 percent less than those of TSMC.

And as a foundry TSMC’s “final” sales – the amount charged by its fabless clients to their customers – is about 2x that of its own sales figure.

Therefore, IC Insights estimates that TSMC was the source for about $113 billion in fabless chip sales in 2021 and will be for about $40 billion in 3Q22.

TSMC’s “final” sales responsibility is estimated to have represented 18.5 percent of the world’s semiconductor market in 2021 and is set to reach 25 percent in 3Q22, IC Insights said.

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