In the August update of its McClean Report, the generally quite reliable US market researcher IC makes rather pessimistic statements and forecasts regarding the development of the global chip market. According to the report, growth in the market is expected to reach only 7% this year instead of 11%.
Micron DDR5 DRAM (Source: Micron Technology)IC Insights attributes this rather modest increase to the 'collapse' of the memory market, which began at the end of the second quarter. "It was as if someone had turned a switch for the memory market to the off position in June," says IC Insights. Storage manufacturers attribute this abrupt change from the strong expansion seen in 2021 to the correction of inventory levels at their customers. This will therefore continue into 2023.
One example is the situation at Micron Technology, which issued an early warning at the end of May, predicting a 17% drop in sales for its financial period through to August. Micron later revised this figure to -21%. The situation is similar at Samsung. At the beginning of September, Kyung Kye-hyun, co-CEO and head of the semiconductor division, said at the opening of a new production line: "The second half of the year looks bad, and so far next year doesn't seem to offer any impetus for improvement either."
Change at the top of the IC manufacturers?
From this, IC Insights derives the (daring) hypothesis that the Taiwanese contract manufacturer TSMC could take the lead among IC manufacturers starting in the third quarter of 2022 - and thus overtake the current leader Samsung. Despite massive investments in new fabs at various domestic and international locations, Intel would then only remain in a meagre third place. According to IC Insights, Intel's turnover would then be 26% lower than that of TSMC. Not easy to accept for the historic IC pioneer.
However, the calculation of TSMC's leading position is rather shaky: it also includes the so-called 'final sales', i.e. the sales made by various customers to system manufacturers and end users with chips from TSMC - and their margins are 50% higher than those of TSMC itself. IC Insights applies a multiplier of two here and thus arrives at the new ranking of IC suppliers mentioned. For TSMC, this would be a phenomenal rise: in 2021, it was still in third place, with sales 32% below those of Samsung.
www.micron.com
www.tsmc.com
