In the past few years, the semiconductor market was full of people, but since the beginning of this year, PCs, smartphones and other terminal markets have continued to be depressed. Chip prices have continued to fall, and the surrounding cold is approaching. The semiconductor market has entered a downward cycle and winter has entered early.
The process from demand explosion, out of stock price increase, investment expansion, release of production capacity, to shrinking demand, overcapacity, and price drop is regarded as a complete semiconductor industry cycle.
From 2020 to the beginning of 2022, semiconductors have experienced a major industry cycle with upward prosperity. Starting from the second half of 2020, factors such as the epidemic have led to major demand explosions. The storm ensued. Then various companies threw huge sums of money and invested wildly in semiconductors, which caused a wave of production expansion that lasted for a long time.
At that time, the semiconductor industry was in full swing, but since 2022, the global economic situation has changed a lot, consumer electronics has continued to slump, and under various uncertain factors, the originally booming semiconductor industry has been "foggy".
In the downstream market, consumer electronics represented by smartphones are on the decline. According to a research conducted by TrendForce on December 7, the total global output of smartphones in the third quarter reached 289 million units, a decrease of 0.9% from the previous quarter and a decrease of 11% from the previous year. Over the years, the pattern of positive growth in the peak season of the third quarter shows that the market conditions are extremely sluggish. The main reason is that the smart phone brand manufacturers are quite conservative in their production plans for the third quarter in consideration of prioritizing the inventory adjustment of finished products in channels. Coupled with the impact of the weak global economy, brands continue to lower their production targets. .
TrendForce thinks on December 7 that since the third quarter of 2021, the smartphone market has shown warning signs of a significant weakening. So far, it has shown annual decline for six consecutive quarters. It is estimated that this wave of trough cycle will follow With the correction of channel inventory levels completed, it is not expected to pick up until the second quarter of 2023 at the earliest.
At the same time, DRAM and NAND Flash, the two major areas of memory, continued to decline as a whole. In terms of DRAM, TrendForce Research on November 16 pointed out that the demand for consumer electronics continued to shrink, and the decline in DRAM contract prices in the third quarter of this year expanded to 10%. ~15%. In the third quarter of 2022, the revenue of the DRAM industry was US$18.19 billion, a 28.9% decrease from the previous quarter, which was the second highest rate of decline since the 2008 financial tsunami.
Regarding NAND Flash, TrendForce said on November 23 that the NAND Flash market in the third quarter was still under the impact of weak demand. Both consumer electronics and server shipments were worse than expected, leading to a wider decline in NAND Flash prices in the third quarter. to 18.3%. The overall revenue of the NAND Flash industry is approximately US$13.71 billion, a 24.3% quarter-on-quarter decline.
Consumer electronics accounts for about 40% of the semiconductor application market, and companies in all links of the industry chain are closely connected, so it is inevitable that they will encounter downstream cold winds. As all parties release early warning signals, industry organizations point out that the semiconductor industry Winter has come.
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