Moderate recovery in demand, adding variables to the peak season effect of semiconductors in the second half of the year

Source: Mantianxin

    On May 15th, according to Taiwanese media reports, terminal demand was weaker than expected, and the adjustment period for the semiconductor industry was prolonged. TSMC and Liandian, the two major wafer foundries, simultaneously lowered their output estimates for this year‘s semiconductor and wafer foundries. The traditional peak season effect of semiconductors in the second half of the year is full of variables.

    Based on the views of semiconductor manufacturers in Taiwan, China, the overall economic environment is highly uncertain due to inflation, interest rates and other impacts. The supply chain has a conservative attitude towards stocking goods. Customers have more urgent orders and shorter orders, and the visibility of orders is not clear.

    Liandian expects its operations to bottom out in the first quarter, but the recovery is weaker than expected. In the second quarter, wafer shipments will only remain flat compared to the first quarter. This year, the semiconductor industry‘s revenue may decrease by 4% to 6%, a decrease higher than the original estimate of 1% to 3%; The revenue of wafer foundry industry will decrease by 7% to 9%, which is higher than the original estimate of 4% to 6%.

    TSMC estimates that the semiconductor industry output excluding storage will decrease by a median percentage (approximately 4% to 6%) this year. TSMC‘s US dollar revenue is expected to decrease by as low as a mid single digit percentage (approximately 1% to 6%) this year, with a outlook for slightly lower than originally estimated growth.

    The legal representative estimates that TSMC‘s operations will bottom out in the second quarter and only gradually recover in the second half of the year, rather than showing a "V-shaped" strong recovery. The demand situation varies among different application markets. Due to early inventory adjustments in the television and computer markets, demand is currently relatively hot, and the industrial market remains stable.

    The demand for mobile phones and consumer markets is relatively weak. Although MediaTek, a mobile phone chip manufacturer, is optimistic about improving its operational performance in the second half of the year, the visibility of demand in the terminal market is limited and cannot provide accurate numbers.

    Touch chip manufacturer Yilong focuses on the laptop application market, and driven by the synchronous growth of touch screen control chips and fingerprint recognition chips, its revenue in the second quarter is expected to reach NT $2.6 billion to NT $2.8 billion, with a quarterly increase of 8% to 16%. The outlook is relatively optimistic. However, Yilong stated that customers‘ stocking attitude remains conservative and demand visibility remains low in the second half of the year.