Chips' Industry trends are forward-looking

1. The United States announces “guardrail” rules for the chip bill

2. It is said that some MCU materials and parts are on the rise in price, and prices are gradually bottoming out.

3. High-priced DDR5 products may face supply shortages

4. Qualcomm responds to reports of large-scale layoffs

5. IDC: The global semiconductor market is expected to return to the growth track in 2024

U.S. announces “guardrail” rules for chip bill

The U.S. Department of Commerce’s Chip Program Office (CHIPS Program Office) stated in a statement that the U.S. Department of Commerce issued final rules on September 22 to implement the national security protection measures of the "Chips and Science Act." The rule details two core provisions of the bill: the first provision prohibits chip fund recipients from expanding semiconductor material production capabilities in other relevant countries within ten years; the second provision restricts recipients from conducting business with relevant foreign entities. Certain joint research or technology licensing activities. (Interface News)

Europe’s Chip Act officially comes into effect

On September 21, local time, the European "Chip Act" officially came into effect. An announcement issued by the European Commission that day stated that the plan promotes the industrialization of key technologies through the "European Chip Plan" and encourages public and private enterprises to invest in the manufacturing facilities of chip manufacturers and their suppliers. (China Business News)

Germany becomes the location for more than half of new EU wafer manufacturing projects

The German Trade and Investment Agency (GTAI) has sorted out 16 new microchip factory projects in the EU in detail, 10 of which are located in Germany, including Intel's large-scale 38 billion euro factory in Magdeburg and TSMC's Dresden area The new EUR 11 billion factory and Infineon's EUR 5 billion expansion. Bosch, GF, Vishay and X-Fab are also expanding across Germany, while Wolfspeed is building a €2.5 billion factory in the southwestern town of Ensdorf. (Science and Technology Innovation Board Daily)

The Korean government will invest 2.2 trillion won to develop advanced industrial clusters

On September 18, South Korea's Ministry of Economy and Finance, together with relevant government departments, held an emergency meeting of economic ministers at the Seoul Government Building and announced the follow-up action plan for "Promoting Global Clusters of Advanced Industries." The South Korean government has pledged to invest 400 billion won next year and 2.2 trillion won over the next five years in innovative capacity cluster special zones such as national strategic industrial zones, advanced medical comprehensive zones, and R&D centers. In particular, we are seeking to exempt the "Yongin Semiconductor Professional Zone" from the preliminary feasibility assessment of public institutions to speed up construction. (Business Korea)

Analyst: China’s Taiwan wafer foundry output value will drop 13% in 2023

DIGITIMES analyst Chen Zejia recently pointed out that the output value of Taiwan's wafer foundry in 2023 is estimated to be US$77.9 billion, a year-on-year decrease of 13%. This decline is 10 percentage points lower than the previous forecast. The reason is that the consumer electronics market is weak and supply chain adjustments have not been completed as scheduled. In the second quarter, the average capacity utilization rate of wafer foundries was only 70%. Chen Zejia predicts that the wafer foundry market will bottom out in 2024, with a year-on-year growth of 15%, but it will still be affected by demand uncertainty. (Science and Technology Innovation Board Daily)

SEMI: It is estimated that the 8-inch fab capacity of automotive and power semiconductors will increase by 34% from 2023 to 2026

The SEMI report pointed out that in order to meet future market demand, suppliers including Bosch, Infineon, Mitsubishi, ON Semiconductor, and STMicroelectronics are accelerating their 8-inch factory production capacity. It is estimated that the production capacity of 8-inch factories for automobiles and power semiconductors will increase by 34% from 2023 to 2026. (Science and Technology Innovation Board Daily)

IDC: The global semiconductor market is expected to return to growth in 2024

IDC predicts that the global semiconductor industry market size will decrease by 13.1% year-on-year to US$518.8 billion in 2023, and return to the growth track in 2024, growing by 20.7% year-on-year to US$625.9 billion. In the long term, the semiconductor industry will be driven by four new technology applications: automotive, data center, industrial and AI. IDC predicts that the global semiconductor industry output value will reach US$1 trillion by 2032. (Science and Technology Innovation Board Daily)

TrendForce: Revenue of the world's top ten IC designers increased by 12.5% quarter-on-quarter in the second quarter

According to TrendForce, AI has stimulated related supply chain stocking boom. In addition to driving the revenue of the world's top ten IC design companies to US$38.1 billion in the second quarter, a month-on-month increase of 12.5%. TrendForce predicts that the world's top ten IC design revenue will continue to have double-digit quarterly growth in the third quarter, and the output value is expected to hit a new high. (TrendForce)

New trends in major manufacturers

Qualcomm Shanghai was exposed to large-scale layoffs: maximum compensation N+7, no triple cap limit

Recently, news has circulated on major community platforms that Qualcomm Shanghai is about to lay off large-scale layoffs. It is said that the layoffs are mainly concentrated in the wireless business R&D department. The compensation standard is N+4 for ordinary employees (including new employees), N+7 for senior employees with no fixed term, and there is no triple cap limit. Qualcomm stated that this is part of the adjustment plan announced by the company's headquarters earlier this year, and the "large-scale withdrawal from Shanghai" and "one nest" reported online are not true. (Interface News, Core Intelligence News)

NIO: The first self-developed chip "Yang Jian" will be mass-produced in October

NIO announced that its first self-developed chip, the lidar main control chip "Yang Jian", will be mass-produced in October. The "Yang Jian" chip is the first self-developed chip released by NIO's intelligent hardware team. It has an 8-core 64-bit processor, which provides powerful computing support. It is also equipped with an 8-channel 9-bit ADC with a sampling rate of up to 1GHz, which can efficiently capture lasers. The raw data of the radar sensor will also reduce the power consumption of the lidar by 50%. (Science and Technology Innovation Board Daily)

GlobalFoundries signs a 10-year US$3.1 billion chip supply contract with the U.S. Department of Defense

On September 21, local time, GF announced that the U.S. Department of Defense has awarded it a new ten-year contract to supply chips for a wide range of critical aerospace and defense applications. The U.S. Department of Defense will allocate $17.3 million to it in September this year, with a total spending cap of $3.1 billion over ten years. This is the third consecutive ten-year contract between the U.S. Department of Defense and GF’s foundry business. (Science and Technology Innovation Board Daily)

Biggest investment under India Semiconductor Mission? Micron lays foundation stone for US$2.75 billion factory in India

On September 23, local time, Micron Technology held a groundbreaking ceremony for its US$2.75 billion Assembly, Test and Packaging Factory (ATMP) in Gujarat, India. The event was held at the industrial area of the Gujarat Industrial Development Corporation (GIDC) in Sanand, which has allotted 93 acres of land for the project. It is reported that this project is the largest investment project under the "India Semiconductor Mission" (ISM). (Jiweiwang)

Microsoft Rumored to Cut Order from Nvidia H100 Chip

Recently, there is news that the craze for ChatGPT is gradually fading, and Microsoft has begun to reduce orders for Nvidia H100 chips, and the purchase of goods has slowed down. According to market sources, the lower demand for the AI collaboration tool Microsoft 365 Copilot is not as strong as before, which is also one of the reasons why Microsoft has lowered its chip orders. However, the AI supply chain of China's Taiwanese factory said that Nvidia's AI chips are still in short supply. Microsoft still maintains the outlook for demand to double in 2024 and has raised orders for GH200 chips. The long-term growth momentum of AI servers remains unchanged. (Jiweiwang)

NAND Flash factory Kioxia is rumored to plan to lay off employees

According to people familiar with the matter, after explaining to the labor union on September 21, Kioxia will recruit employees who wish to retire early among regular employees over the age of 56, and will increase pensions and provide reemployment support to the candidates. (TechSugar)

Broadcom to be fined $14.24 million by South Korea for forcing Samsung to sign long-term supply agreement

The Korea Fair Trade Commission (KFTC) said it would temporarily fine Broadcom and its affiliates 19.1 billion won (approximately $14.24 million) for forcing Samsung Electronics to enter into a long-term supply agreement that includes radio frequency (RF) front-end circuits. , Wi-Fi and Bluetooth components. The contract includes a clause that Samsung must purchase $760 million worth of Broadcom components from January 2021 to the end of 2023, and if the purchase amount is less than this, it will need to make up the difference. (TechSugar)

Intel fined approximately $400 million

Intel was fined 376 million euros (approximately US$400 million) in an EU antitrust case on September 22, local time. It is understood that the case stems from the fact that Intel abused its dominant position in the chip market nearly 20 years ago to block competitors' sales. The EU imposed a huge fine of 1.06 billion euros ($1.13 billion) for "antitrust violations", but the headquarters Europe's second-highest general court in Luxembourg dismissed the decision last year. Recently, after a re-examination, the EU antitrust regulator determined that Intel had indeed abused its market dominance rules at that time, and once again imposed a fine of US$400 million on Intel. (Xinzhixun)

Toshiba announces the success of its US$13.5 billion privatization transaction and will be delisted from the Tokyo Stock Exchange

According to Toshiba's official website, more than half of its shareholders recently participated in a US$13.5 billion (currently approximately 98.55 billion yuan) acquisition transaction led by private equity fund Japan Industrial Partners (JIP), reaching the threshold for privatizing the company. Thus ending its 74-year history as a listed entity. (China Business News)

Chip market

Will new AI PC chip products be slowed down first? AMD: No strong market demand seen

Justin Galton, associate director of global business development for AMD's commercial customer business, said in an interview that, except for the most high-end parts, AMD currently does not see widespread market demand for x86 architecture PC chips dedicated to artificial intelligence (AI). This is why This is why AMD has only launched one PC CPU equipped with a dedicated AI accelerator so far. (DigiTimes)

UMC and ASE’s CoWoS advanced packaging interposer orders may double, or prices may increase

TSMC is actively expanding its advanced packaging production capacity, and has recently placed an additional 30% of equipment orders for equipment manufacturers. This has led to a simultaneous doubling of subsequent orders from UMC, ASE and other manufacturers in the CoWoS advanced packaging interposer supply chain. UMC and ASE may increase prices. Among them, UMC has raised prices for intermediary orders for super hot runs and launched a capacity doubling plan; ASE's advanced packaging quotations are also planning to increase. (Taiwan Economic Daily)

Nvidia pursues orders for AI chips, while TSMC purchases additional equipment to expand CoWoS production capacity

TSMC's CoWoS advanced packaging production capacity is overflowing. As it actively expands production, it is reported that its major customer Nvidia has increased its orders for AI chips. In addition, AMD, Amazon and other major manufacturers have urgent orders. For this reason, TSMC is urgently looking for equipment suppliers to purchase additional CoWoS machines. Taiwan, in addition to the existing production increase target, equipment orders will be increased by another 30%.

This time, TSMC is seeking assistance from equipment manufacturers such as Xinyun, Wanrun, Hongsu, Titanium, and Qunyi, requesting the expansion of reinforcements for CoWoS machines. It is expected to complete delivery and installation in the first half of next year. According to industry insiders, TSMC's current CoWoS advanced packaging monthly production capacity is about 12,000 pieces. After the expansion was launched, the original plan was to gradually expand the monthly production capacity to 15,000 to 20,000 pieces. Now that additional equipment is added, the monthly production capacity will reach More than 25,000 pieces. (Taiwan Economic Daily)

It is rumored that some MCU materials and parts are on the rise in price, and prices are gradually bottoming out.

On September 20, it was reported that China's MCU market situation has seen signs of improvement recently, with some materials and parts replenishing inventory, and MCU factories have seen price increases for some materials and parts, with prices gradually bottoming out. Wafer fab costs are expected to loosen next year, which will gradually help gross profit margins. (Jiweiwang)

Supply chain insiders: Intel Gaudi 2 special edition orders surge

According to supply chain sources, orders for Gaudi, the "special edition" AI processor launched by Intel in the domestic market, have been rising sharply in the past two months. Gaudi 2 uses TSMC's 7nm process. Intel is now pursuing orders from TSMC. It is understood that the order visibility has reached mid-2024. The next generation Gaudi 3 using TSMC's 5/4nm process is also accelerating its launch in 2024. (DigiTimes)

High-priced DDR5 products may face supply shortages

Industry insiders said that DRAM prices are expected to rebound in the next quarter, but as end market demand has not yet seen a significant recovery, the increase may not be too large. DDR5 memory module prices will rise further after rising by 5-10% in the past month, and entry-level product prices will also rise by 3-5%. In addition, high-priced DDR5 products are expected to face supply shortages, leading the DRAM market. (Jiweiwang)

Memory chip manufacturers increase Q4 contract prices, with the increase likely to be more than 10%

Recently, manufacturers in the lower reaches of the contract market have received notices from original manufacturers that contract prices will be raised in Q4, which will also give customers in the contract market time to notify downstream customers of price increases in September. According to the notice issued by the original manufacturer, different products have different increase rates, but the increases are almost at double-digit levels. Among them, the Q4 contract price of NAND flash memory is expected to increase by 10% to 20%, and DRAM will increase by approximately 10%.

According to industry insiders, the original factory's stance on price increases this time is firm and clear. It may be because they already have large orders from major manufacturers and have specific orders to consume their production capacity. They are sure that there will be a gap in supply and demand, so they feel confident to shout out in one go. The price increase is also expected to end this wave of shrinking memory chip prices. (Science and Technology Innovation Board Daily)

Cutting edge core technology

The most advanced chips are coming? US scientists successfully develop high-performance two-dimensional semiconductor wafer

Researchers at the University of Pennsylvania's School of Engineering and Applied Science have fabricated a high-performance two-dimensional semiconductor into full-size, industrial-scale wafers. In addition, the semiconductor material indium selenide (InSe) can be deposited at low enough temperatures to allow integration with silicon chips. The latest research results were recently published in the journal Matter. (Science and Technology Innovation Board Daily)

Starting a revolution in semiconductor packaging, Intel demonstrates advanced glass substrate technology

Intel has disclosed its progress in the development of semiconductor glass substrate technology, aiming to increase the upper limit of the number of transistors in a single package chip to 1 trillion by 2030. Intel said that compared with the current mainstream organic substrates in the industry, glass has unique properties and has better performance in terms of flatness, thermal stability and mechanical stability. The latest advanced packaging is expected to be mass-produced from 2026 to 2030, and will first be introduced into data centers, AI, and graphics that require larger packaging, higher-speed applications and workloads. (Taiwan Economic Daily)

Terminal core trend

Counterpoint: Nearly 500 brands have withdrawn from the smartphone market from 2017 to 2023

According to a report released by market research agency Counterpoint Research, nearly 500 brands have withdrawn from the smartphone market between 2017 and 2023. The report believes that the reasons for these brands to withdraw from the smartphone market include immature user base development, increasing equipment quality requirements, long user replacement cycles, expanding second-hand refurbishment market, economic downturn, supply chain bottlenecks, and major technological transformations such as 4G to 5G. wait. (Counterpoint Research)

Luxshare Precision Chairman: Three iPhone 15 models will be produced this year to prepare for Apple Vision Pro production

On the occasion of the launch of Apple's new iPhone 15 series, Wang Laichun, chairman of Luxshare Precision, said that it will produce three iPhone 15 models for Apple this year, and its business (scale) has doubled compared with the past year. He also said that it is working on the Apple Vision Pro Prepare for production.

Wang Laichun emphasized that we will continue to expand production capacity in China to meet Apple's demand. Last year, the company built a new campus in Kunshan specifically to support the development and mass production of iPhones. The park created tens of thousands of jobs and also made significant financial contributions to the local area. (juheng.com)

Canalys: Market demand for wearable wristband devices is rebounding, with an average annual growth rate of 4.1% expected

Research organization Canalys recently released statistics showing that in the second quarter of 2023, Apple, Xiaomi, and Huawei were the top three wearable wrist-worn device brands, with Apple shipping 8.1 million units accounting for 18%, and Xiaomi shipping 4.8 million units accounting for 18%. Accounting for 11%, Huawei shipped 4.3 million units accounting for 10%. The fourth and fifth ranked brands are Noise and Fire-Boltt respectively, with other manufacturers accounting for a total of 47%. Driven by changes in consumer demand, the global wearable wristband market is expected to continue to grow at an average annual growth rate of 4.1% until 2027. (Canalys)

Agency: Game monitor shipments will grow by 10.8% in 2023, while gaming PC shipments will decline

Research firm IDC said that as the demand for personal computers and monitors slows down, the demand for gaming monitors and gaming PCs has recovered. The agency predicts that global game monitor shipments will increase by 10.8% year-on-year in 2023, while gaming PCs will decline by 10.5%, but the decline will be smaller than the overall PC market. (Jiweiwang)

The above news is summarized and compiled from the following sources: Jiemian News, China Business News, Science and Technology Innovation Board Daily, BusinessKorea, TrendForce, Xinzhixun, Jiwei.com, TechSugar, DigiTimes, Taiwan Economic Daily, Counterpoint Research, Juheng.com, Canalys

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