World’s chip market plunge accelerated in November
The global chip market declined by 9.2 percent annually in November 2022 driven down by even steeper falls in sales the Chinese and Asia-Pacific markets, according to the Semiconductor Industry Association.
The SIA reports data collected by the World Semiconductor Trade Statistics organization based on a three-month moving average so the latest figures are average of September, October and November on a regional basis. The Americas, European and Japanese markets continued to grow over the same period but together they represent less than half the global market.
The latest figures are part of a global chip market contraction that has been driven by China that has been accelerating over the last few months. The figures point to exceptionally weak 4Q22 sales but with the hope of a recovery thereafter as China abandoned its zero-covid policy. The lockdowns that followed from that policy are thought to have hindered economic acitivity in China. Added to this has been a drop in consumer electronics purchasing.
The Chinese market according to November’s 3MMA sales data was worth US$13.41 billion, down 21.2 percent from the same period a year before. The Asia-Pacific market excluding China and Japan was valued at US$11.46 billion, down 13.9 percent.
The Americas region was up 5.2 percent annually, Europe up 4.5 percent and Japan was up 1.2 percent. It remains unclear whether these market regions can avoid a semiconductor market recession.
Positive indicator
One positive indicator in the SIA numbers is that they show the sequential quarterly decline global sales is continuing to reduce. This decline was 6.3 percent for 3Q22 over 2Q22. In November it was a 3.7 percent decline for Nov/Oct/Sept over Aug/July/June. There is an expectation that is will be yet lower in December’s figures which will represent the 4Q22 compared with the 3Q22. The hope is that global growth can resume in 2023.
Three-month average of chip sales by geographic region for November and October 2022. Source: SIA/WSTS.
“Global semiconductor sales decreased in November, largely due to market cyclicality and macroeconomic headwinds,” said John Neuffer, CEO of SIA, in a statement.
Monthly data is given by the SIA as a three-month average although the source of the data, World Semiconductor Trade Statistics, tracks monthly data. The SIA and other regional semiconductor industry bodies opt to use averaged data because it evens out the actual data that typically shows troughs at the beginnings of quarters and peaks at the ends of quarters.
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