The Tech Week that was... May 22 ~ 26

Welcome to the latest edition of my weekly newsletter bringing you all the key semiconductor and technology news from around the world in one easy read.?

Don’t know about you, ?but I feel that overall the news is getting more positive this week, what do you think? Are things looking up? ??This week China bans Micron from critical infrastructure after failing security review, AMAT plans US$4billion R&D centre, Apple and Broadcom sign 5G made-in US chip deal, Nvidia forecasts 50% revenue growth in fiscal Q2 on AI demand, TSMC continues talks on a new European Fab whilst Sony considers a new CIS Fab in Japan.

China cyberspace regulator has concluded it’s security review of Micron and announced that the company’s memory chips pose “serious network security risks.” ?As result Micron chips will be banned from key infrastructure projects in China. ?In a statement, the Cyberspace Administration of China (CAC) said: "The review found that Micron's products have serious network security risks, which pose significant security risks to China's critical information infrastructure supply chain, affecting China's national security."?Micron has said the ban will impact revenue in the low to high single digit range.??

South Korea has asked the United States to reconsider details of the guardrail provision of its CHIPS Act, to ease the regulations limiting Korean chipmakers from expanding their production capacity in China. South Korea (ROK) said “The ROK believes that the ‘guardrail provisions’ should not be implemented in a manner that imposes an unreasonable burden on companies investing in the United States.”

Nvidia reported its fiscal Q1 2024 earnings, with Q1 earnings up 19% sequentially to US$7.2billion, although this was down -13% YoY.?The company reported record Data Centre revenue of US$4.3billion.?The company said it is seeing surging demand for it’s data centre products driven by demand from cloud vendors as well AI companies. ?For Q2 the company is forecasting sales of US$11billion, up a whopping +53% sequentially!

Apple announced a multi-billion-dollar multi-year deal with Broadcom to develop made-in-USA chips.?Apple said it is partnering with Broadcom to develop 5G radio frequency components, including FBAR filters, and cutting-edge wireless connectivity components, with the FBAR filters designed and made in several sites in the US, including Broadcom's facility in Fort Collins, Colorado.?The deal which promotes the concept of “investing in the US” ?may impact Skyworks which currently supplies many RF FEM products and to a less extent Qualcomm.?

US. Equipment Manufacturer, Applied Materials has announced plans to build a research and development centre in California that could, contingent on receiving Chips Act incentives, be the largest facility of its kind in the world.?The “Equipment and Process Innovation and Commercialization” (EPIC) Centre, would include 180,000 sq ft of cleanroom. Applied Materials says it plans to invest as much as $4 billion in the facility, which would be built at its Silicon Valley campus in Sunnyvale, Calif.

Sony has said it’s chip business would by land in Kumamoto, western Japan and is in talks to buy 27 hectares, amid reports that Sony is considering building a new smartphone image sensor Fab.

TSMC is continuing to investigate the possibility of a new Fab in Germany and the earliest decision point will be in August according to TSMC SVP of Business Development, Kevin Zhang. The Fab is rumoured to a joint development with European automotive partners Bosch, NXP and Infineon to invest up to US$11 billion to build a new Fab in Saxony Germany focused on automotive manufacturing.

In Market Research News..

SEMI President and CEO Ajit Manocha has said he believes that while “chip nationalism” is becoming commonplace, it is not necessarily bad but would undoubtedly change the semiconductor landscape in an interview with Tech Wire Asia. Ajit reckons that multiple hubs worldwide would encourage the growth of the chip industry, which is expected to reach US$1 trillion in revenue by 2030 and would reduce the dependence on a few hubs. He also believes the chip shortage is close to over as demand has softened while companies add more capacity.

The global semiconductor packaging materials market is expected to reach US$29.8 billion by 2027, a compound annual growth rate (CAGR) of 2.7% from the US$26.1 billion in revenue it logged in 2022, according to the latest update form SEMI, TECHCET & TechSearch International.?Contributing to the growth is the increasing demand for high-performance applications, 5G, artificial intelligence (AI) and the adoption of heterogeneous integration and system-in-package (SiP) technologies together with the development of new materials and processes to enable chips with higher transistor density and greater reliability.

According to the latest data from Trendforce , DRAM revenues continued to decline in Q1 to US$9.7billion, a sequential drop of -21%.?This significant dip represents the third consecutive quarter where revenues have fallen. Only Micron reported increased shipments, with all other suppliers noting a decrease and the ASP fell for all three major suppliers. The industry expects a gradual slowing in the rate of price decline following planned production cuts with TrendForce’s Q2 forecast suggesting a rise in shipments, but the ongoing price fall might limit potential revenue growth.

TrendForce forecasts that AR/VR device shipments for 2023 will decline to roughly 7.45million units, ?a -18% Yoy decline with VR device shipments accounting for much of this decline.?This dip is primarily attributed to weaker-than-expected sales of newly released high-end devices, with manufacturers expected to react by focusing on more cost-effective offerings. While Apple’s latest offerings could stimulate some demand, the high price tags attached to these units continue to pose a significant barrier to broader market growth. Meta Quest 2 continues to maintain its status as this year’s market-leading VR product as the release of Meta Quest 3 has been pushed back to 2024.?Trendforce expects that the market will rebound by 2025 with potential growth of around 40% in shipments.

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?Stay safe and healthy... bye