Shrinking demand for consumer electronics is causing cancelled orders and unsold stockpiles at makers of integrated circuits including Taiwan Semiconductor Manufacturing Co (TSMC), Advanced Micro Devices Inc (AMD) and Nvidia. It's a stark contrast with the disruptions that chip shortages caused for makers of autos, smartphones, computers and other goods that rely on the advanced electronic devices.
Shrinking smartphone, PC demand
- Global 5G smartphone shipments will shrink by as much as 150 million units in 2022, and demand for 5G phone chips will fall by 100 million to 120 million units.
- Smartphones and PCs have a decisive impact on the semiconductor industry, one analyst said.
Weak Chip Outlook
- Weak chip outlook
- TSMC, the world’s largest contract chipmaker, faces reduced orders from four of its largest customers due to slowing global demand.
- AMD lowered its revenue forecast for the third quarter, citing weakening in the PC market, and Intel, Nvidia and Micron Technology all issued subdued outlooks.
Where's the bottom?
- New capacity built amid a historic chip shortage since the second half of 2020 will gradually come online starting at the end of 2022
- This means the global chip industry will enter a sustained period of overcapacity
- In the long term, global wafer capacity is in tight balance or regional oversupply
- China is in short supply as expanding capacity is one of the country's core objectives
https://www.straitstimes.com/asia/east-asia/the-sudden-reversal-of-the-global-chip-shortage
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