Worldwide semiconductor gross sales are down 0.5% in September, on a month-to-month foundation, in accordance with statistics launched by the Semiconductor Trade Affiliation, and down 3% in comparison with September 2021, as demand continues to melt within the face of a number of macroeconomic difficulties.
In response to the SIA’s report, September chip shopping for within the Americas area rose by 11.5% in comparison with the identical month in 2021, to a complete of simply over $12 billion, and upticks to $4.53 billion and $4.05 billion, respectively have been seen in Europe and Japan. These beneficial properties, nonetheless, have been greater than offset by the mainland Chinese language market falling by 14.4% to $14.43 billion in the identical timeframe, together with a 7.7% decline to $11.97 billion in all different markets.
The decline is the primary year-on-year slowdown since January 2020, in accordance with a press release issued by SIA president and CEO John Neuffer.
“The long-term market outlook stays robust, nonetheless, as semiconductors proceed to turn into a bigger and extra vital a part of our digital economic system,” he stated.
Whereas Nueffer’s bullishness is echoed by different longer-term forecasters, a number of different indicators of a short-term decline for the world’s silicon makers exist, together with latest Intel earnings information that noticed the corporate’s third-quarter income drop 20% on a year-on-year foundation. Internet revenue for the US-based chipmaker plummeted from $6.8 billion within the third quarter of 2021 to $1 billion in the newest report, a drop of 85%.
The chip business is going through structural upheavals brought on by altering US commerce coverage towards China, provide chain disruptions brought on by Russia’s invasion of Ukraine, and a prevailing view that the worldwide economic system is headed for a recession, which has blunted demand.
A research launched earlier this month by MIT and printed within the Harvard Enterprise Evaluate highlighted that the “overwhelming majority” of chip manufacturing takes place in Taiwan, the Individuals’s Republic of China and South Korea, and that latest US strikes— together with the CHIPS Act—aimed toward decreasing the nation’s dependence on abroad provide will take a very long time to bear fruit.
“The optimistic estimate [for the construction time on new semiconductor facilities in the US] is at the very least two years,” the research’s authors wrote, noting that efficient dependence on East Asia for chip provides is a matter of meeting and testing services as a lot as uncooked manufacturing functionality.
The newest commerce restrictions, enacted by the US Commerce Division earlier this month, are more likely to trigger main issues for the Chinese language home silicon business, most prominently within the space of superior chips. General, specialists agree, present provides of silicon have outstripped demand, at the same time as particular person markets, just like the automotive sector, wrestle with persevering with shortages.
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