Korean media: The wafer foundry industry is cold, and the visibility of some factory orders is less than 6 months
Nov 11,2022
On November 10, South Korean media ETNEWS reported that the global demand for wafer foundry has begun to decline, and the capacity utilization rate of some factories has not reached 100%, which is completely contrary to what the industry expected at the beginning of this year.As the price of raw materials for wafer foundry continues to rise, Korean media believe that the foundry market will inevitably face a decline in profits.
The report points out that the number of foundry orders of chip design companies is declining significantly, and the order visibility of some wafer foundries has even been reduced to less than six months. Senior executives from the 8-inch wafer foundry industry said: "It is inevitable that demand will decline next year. The capacity utilization rate of some process nodes is not 100%, and new orders will decrease significantly."
Korean media believe that major downstream industries such as smartphones and PCs have been hit by the global economic downturn. The demand prospect for OEM of semiconductor products such as power management chips (PMIC), display driver chips (DDI), radio frequency (RF) chips has deteriorated. The bottleneck effect of automobile semiconductor demand is also being solved, such as micro controller unit (MCU).
China is considered the largest market in the semiconductor industry. The Korean media said that the sales setback in this market hindered the export of domestic chip design companies. The CEO of a Korean company that supplies auto chips to China said: "We have to adjust the production of semiconductor products because the sales volume in China has dropped significantly. If we cannot find another market, we will have no choice but to reduce new orders in the OEM market."
In addition, Korean media also said that the decline in demand of the wafer foundry industry will not be reflected in this year's financial report data, because they have enough original long contract orders. However, as the cost of raw materials required for the chip manufacturing process is rising while the demand is declining, the performance decline from next year is inevitable. An insider said, "The purchase price of silicon chips, various materials, industrial gases and other raw materials has risen by about 10% every quarter."
China is considered the largest market in the semiconductor industry. The Korean media said that the sales setback in this market hindered the export of domestic chip design companies. The CEO of a Korean company that supplies auto chips to China said: "We have to adjust the production of semiconductor products because the sales volume in China has dropped significantly. If we cannot find another market, we will have no choice but to reduce new orders in the OEM market."
In addition, Korean media also said that the decline in demand of the wafer foundry industry will not be reflected in this year's financial report data, because they have enough original long contract orders. However, as the cost of raw materials required for the chip manufacturing process is rising while the demand is declining, the performance decline from next year is inevitable. An insider said, "The purchase price of silicon chips, various materials, industrial gases and other raw materials has risen by about 10% every quarter."