Inventory digestion and traditional off-season IC design factory Q1 performance may drop to "freezing point"

According to IC design manufacturers, in the first half of the year, demand for the three major applications of PCs, mobile phones, and consumer electronics was weak. Some IC design factories continued to reduce their investment in wafer foundries this quarter, which affected TSMC and other foundries to receive orders.

According to Taiwan media "Economic Daily", the IC design factory pointed out that the first quarter is the traditional off-season, coupled with the bad economy, the supply chain continues to digest inventory, under the influence of dual factors, the annual decline in performance in this quarter and even in the first half of the year may decrease. Obviously, this year's off-season effect will be more obvious.

The report pointed out that in addition to the European and American market demand being suppressed by inflationary factors, and the trend of interest rate hikes has not stopped, the Chinese mainland market is also being disrupted by the epidemic. After the Lunar New Year holiday, it may be possible to see whether the Chinese mainland's economy is picking up. As for when the overall semiconductor market will recover, IC design factories believe that the situation in the first two months of this year will not be hot, so they can only observe the market conditions from March to May. The current focus is to continue to reduce inventory, retain cash, and wait until these few months.

A few days ago, Taiwanese media reported that due to the fact that the global economic environment is still suffering from inflation at this stage, both enterprises and consumers have obviously shrunk in spending, which also makes the semiconductor industry still maintain a conservative attitude towards the first half of next year. IC design companies generally expect , Before the inventory depletion is over, the revenue in the first quarter of this year may continue to bottom out, and it is expected to be the lowest point of the year.

The results of the Nikkei survey of analysts also show that the semiconductor surplus in the second half of 2022 is not expected to ease until at least the fall of 2023. Specifically, the oversupply of smartphone chips is not expected to ease until the fourth quarter of this year; the oversupply of PC chips is expected to peak in the third quarter and then gradually ease; the oversupply of data center chips may continue until the fourth quarter of this year. first quarter.