Honeng weekly Trends for Semiconductors-IC Demand drop off

TI announced its financial report of Q2 2023 in7/25/2023 ,it shows except Automotive industry others customer was keep cutting orders ,it caused TI inventory increased to 207days .

As End customers’ demand has not recovered significantly, the latest report of foreign capital pointed out that the time for inventory consume of MLCC may be prolonged. Looking at the overall market demand, except for the new products of Apple iPhone 15 series, most of the terminal market orders have limited recovery, the distributors of MLCC have a conservative attitude towards inventory and stocking in the second half of the year. Coupled with the weak market, it is estimated that there will not be a rebound in demand until after the first quarter of next year at the earliest.

TSMC held the second quarter of 2023 law conference in 7/20/2023. Except announcing Q2 financial report and releasing Q3 performance, TSMC made public the progress of overseas plant establishment. Among them, the American plant encountered challenges, and the mass production schedule will be extended from the end of 2024 to 2025. The Nanjing plant is expanding the technical capacity of 28 nanometer process as planned. At the same time, Wei Zhejia, the president of the company, once again mentioned the issue of inventory adjustment in the Semiconductor industry, and he expected that the inventory adjustment might continue to the fourth quarter.

Regarding AI, TSMC's management has stated that it has been included in capital expenditure and long-term sales prospects, and it is speculated that about 50% of the future sales growth will come from the AI field. On the other hand, they have admitted that the company is currently unable to fully meet customers' demand for AI. Although the demand for AI is good, it is not enough to offset the overall terminal market demand caused by the economic environment.

AI demand may bring incremental benefits, but in terms of the current level of development of AI, it cannot be reflected in performance. The AI demand brought about by ChatGPT technology can only be partially embedded in its long-term revenue compound annual growth rate guidance of 15-20%, and more meaningful revenue contributions may only be seen after 2025.

Although 2023 traditional peak season is coming , the prospect of Consumer electronics is still relatively bleak. Preliminary observations have found that the demand for automobiles and industrial control is expected to maintain relatively stable performance in the second half of the year.

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In terms of main consumer applications, the expected shipment volume of mobile phones will be further reduced, and the shipment volume of personal computers and laptops is expected to remain moderate. Other consumer products have not shown significant improvement.

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In fact, semiconductor related companies that previously had certain expectations for the traditional peak season of 2H23 have recently begun to feel that the real environment has not significantly improved. More and more companies believe that new growth trends will not restart until 2024.