IC Industry Red Alert September Market Has Been Weakened

At present, analog, memory, PC chips, and others, although they cannot be said to have declined, have shown seasonal weaknesses.

Dan Hutcheson, president of VLSI, believes that after the heat began in early 2010, the current IC industry may return to normal. Some people say that the industry has started to slow down, stop or it is terribly down again, it may not be right.

In other words, the IC market has begun to weaken and is returning to a normal cycle of rational growth.

This is so because sales in September may indicate that the IC industry has many uncertainties in the last quarter of this year, including next year's situation.

Hutcheson said people often say that the whole year can be seen from September. This year's September has really weakened, and it is global. Slowing global economic growth has begun to affect electronics and semiconductors.

The mitigation related to the PC-related chip market presents a state of crossover. The DRAM market is declining. The mobile phone market is still strong, and NAND flash memory remains stable. Analog chip market crossover and IC packaging and OEM market are still relatively good.

Sales of electronic products have also begun to slow, which can be confirmed by OEMs that have been careful in purchasing components. All this is not surprising, because the traditional back-to-school season purchase is over.

According to VLSI, the current IC market growth of 33.7% and 103% increase in equipment are forecast.

If the market does not drop much in the future, this year's data may be even larger. The real impact occurred in 2011 and is expected to be a mild year. Global semiconductor growth in 2011 is forecast to be 6.6% and equipment growth is 10.6%.

According to the VLSI study, what is really worrying now is the last quarter of the year and 2011, because the PC and consumer goods markets are still oscillating. Recently, Intel has reported that the price of processors and chipsets will be drastically reduced in order to clear inventory. At the same time, in the coming weeks, there will be room for another drop in the MPU's selling price.

It has been confirmed that AMD, Intel and Nvidia have all lowered their future performance.

According to a VLSI study, the global memory market has continued to weaken, and DRAM suppliers are facing downward pressure from other prices, and have already reached the alarm level.

According to VLSI's report, the price of DDR3, another mainstream, has fallen by more than six times, far faster than the rate of 24 months Moore's Law. As with the current rate of decline, DRAM makers' profits will begin to appear risky. Recent laptops have been confirmed by the iPad in the Best Buy market.

Immediately after the 1.5% decline in prices last week, the price of each DRAM dropped another 3.7%, which is the largest drop seen in the past two years. The other price of mainstream DDR3 has dropped for the fifth consecutive week, reaching 5.4%. Kingston’s vice president as one of the retailer’s representatives urged that if the market’s weakness remains at 3-4 quarters or more in the future, then the DRAM market may experience another major decline. Due to the weakness of the separately sold market, the total DRAM contract price decreased by 5.2%. According to the company's opinion, the biggest pain was the 9.5% drop in DDR3 contract prices.

Compared with DRAM, the price of NAND flash memory has not fallen so much, and the price of NAND flash memory has fallen by a factor of 2, which is also faster than the 24-month Moore's law rate. The global handset and tablet market is the largest buyer of NAND flash memory. Over the years, only Apple is the largest buyer and it is not conducive to industrial development.

Significant news continues to flow from the significant market. Such as mobile phone chip market is still good. According to Taiwan’s ASE report, its Q4 order in 2010 was better than expected. In addition, the global Tablet market is hot, Samsung announced that its GalaxyTablet has been introduced to the market, which is good news for mobile phone ICs and NAND manufacturers.

According to VLSI, although the IC market has generally slowed down, OEMs are still good. TSMC expects its 2010 sales to increase by at least 40%, and by another 10% in 2011.