The semiconductor industry is poised for a mild recovery in the second half of this year, after a global slump eases in the second quarter, global semiconductor trade association SEMI said.
In a research report released on Tuesday in partnership with US market information advisory firm TechInsights, SEMI said the ongoing inventory adjustments in the semiconductor sector should moderate in the second quarter and give way to a gradual recovery starting in the third quarter.
Q2 IMPROVEMENTS
Industry indicators, including IC sales and silicon shipments, showed quarter-on-quarter improvements in the second quarter, SEMI said.
This represents companies in the electronics manufacturing and design supply chain, it said.
Despite the gains, bloated inventories in the industry continue to keep a lid on silicon shipments, and fab utilization rates have remained significantly lower than levels recorded last year, the trade group said.
Semiconductor equipment sales have continued to decline in line with capital expenditure adjustments by major industry stakeholders, it said.
“The indicators point to a likely bottoming of the current downturn in the second quarter of 2023, with a slow recovery expected to begin in the year’s second half,” it said.
The semiconductor market remains haunted by uncertainty, but a recovery could occur later this year, TechInsights said.
“We expect continuing production cuts and capex [capital expenditure] reductions, especially in the memory market, will start having a positive impact on market fundamentals in the latter part of the year,” TechInsights market analysis vice president Risto Puhakka said in the report.
“This would result in a more balanced market environment,” Puhakka said.
TSMC
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, expects its operations to bottom out in the second quarter and be better in the second half of the year than in the first half, it told an investors’ conference last month.
Due to weaker-than-expected demand, TSMC forecast revenue this year to fall 1 to 6 percent from a year earlier, a downgrade from an estimate of “a slight increase” made in January.
For the second quarter, TSMC said it would generate US$15.2 billion to US$16.0 billion in sales with a median figure of US$15.8 billion, which would be about 6.7 percent lower than a quarter earlier.
TSMC left its capital expenditure budget for this year unchanged at US$32 billion to US$36 billion after the company accounted for growth and client factors over the next few years.
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