Thread by @dnystedt

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Notes from IDC #semiconductor market briefing by VP Mario Morales, head of semiconductors (30-year veteran) 9/2/2021 on Zoom.

Great presentation.

#IDC 1/16

#IDC 2/16

IDC forecasts the 2021 #semiconductor market will grow 17.3% to US$545.0 billion led by phones, laptops, servers, automotive, smarthome, gaming, wearables and Wi-Fi, with increased memory prices.

The market will grow 4% in 2022 and 0.3% in 2023 to $568.4 bln.

#IDC 3/16

Without shortages, #semiconductor market growth would have been over 20% this year, with the bullish case close to 25%.

#IDC 4/16

Materials shortages: Wafers, substrates, and transport, also ceramic parts, high purity quartz, chemicals.

Shipping: Large containers stranded at major ports across regions delaying materials, raising transport costs.

#Semiconductors

#IDC 5/16

Double booking mainly by distributors and contract electronics manufacturers, in order to secure what they need.

During shortage 5-years ago, big suppliers (TSMC, Samsung, Intel) got wafers, should be same now. Big guys get the materials they need.

#Semiconductors

#IDC 6/16

Shortages: Front end (IDM, foundry) has leveled out, bottlenecks in back end (test, assembly).

#Covid19 related shutdowns in Malaysia, Indonesia a problem, but much of chip troubles caused by under-investment, not Covid.

Automotive shortages will ease by year end

#IDC 7/16
Supply chain should continue to improve thru 4th quarter.

IC shortages will continue to ease thru 4th quarter on new capacity additions. By mid-2022, #semiconductor supply chain should be back in balance.

We could see some overcapacity in 2nd half 2022 and into 2023.

#IDC 8/16

No ‘Winter’ for memory chips, says Morales.

DRAM, NAND suppliers have controlled supply well. May see some price erosion by the end of the year in contract prices (spot market has fallen, but represents only 15%-20% of market).

#IDC 9/16

IDC cut its 2021 PC and tablet shipment growth forecast to 14.2% from 18% as supply shortages and logistical challenges hurt sales.

Chips that caused the downgrade include: DDIC, PMICs, WiFi ICs.

#IDC 10/16

Chip foundry ASPs_1
Foundries are booked through end-2021. ASP increases will not come close to 10%-20% media report. Morales believes 5%-7%, to cover higher costs (shipping, materials). Foundries operate by long term contracts, no price gouging $TSM $UMC $SSNLF

#IDC 11/16

Chip foundry Average Selling Prices (ASPs)_2
Most profitable orders are rush orders, beyond what’s already contracted.

Overall, ASP increases are transitory, and are unlikely to last beyond the current shortage/cycle.

$TSM $UMC $SMICY $SSNLF #semiconductor

#IDC 12/16

Rise of #Semiconductors

More devices and More Semiconductors Per Device

Examples:
Smartphones: Now 2x semiconductor content vs 10-years ago, especially 5G content

Computing 23% semiconductor content growth.

#IDC 13/16

Electric Vehicles a key area of long term growth:
EVs will become more complex and will need more chips.
Market now $40 billion in size, but as an ecosystem it’s $2 trillion in size. This is one of the key drivers of growth over the next 5-7 years. #ElectricVehicle

#IDC 14/16

Current Trends in #semiconductors:
Strong global recovery
Increasing DRAM and NAND pricing
Strong 5G phone replacement cycle
Strong rebound in HPC and PCs
Strong edge device demand
Shortages in older nodes
Shortages in automotive
Mfg capacity additions limited

#IDC 15/16
Growth of AI (Estimates) thru-2025
AI Discrete Accelerators; Processors: AI Capable Host, AI Efficient Host
YearRevenue(US$) Growth
2020 $135.6 Bln -4.1%
2021$147.2 Bln +8.5%
2022$156.6 Bln+6.4%
2023$166.1 Bln+6.0%
2024$176.2 Bln+6.1%
2025$184.7 Bln+4.8%

#IDC 16/16

There are over 100 AI semiconductor startups. (artificial intelligence)
#semiconductors

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