Overview of the current situation of the semiconductor industry in 2022
1, high open low go, semiconductor sales have fallen Looking back in 2022, the epidemic, inflation, trade conflicts and supply and demand mismatch are still the core factors leading to the shortage of chips, although the chip market ushered in an inflection point in the second half of the year, sales slowed down sharply, but the annual sales still rose slightly year-on-year. According to the Semiconductor Industry Association (SIA), global semiconductor sales reached $573.5 billion in 2022, a year-on-year increase of 3.2%. Among them, semiconductor sales in the Chinese market reached 180.3 billion US dollars, down 6.3% year-on-year.
Source: SIA, Starling From a regional point of view, China will still be the world’s largest semiconductor consumer market in 2022, accounting for 31.4%, down 6.3% year-on-year; In contrast, the Americas market recorded the largest increase, accounting for 16.0%; Demand in other markets such as Europe and Japan remained relatively stable, accounting for 12.7% and 10.0% respectively.
In 2022, the primary market investment and financing of the semiconductor industry Source: Wind, Chipstarling From the perspective of investment direction, the focus of investment and financing in the primary market of semiconductors in 2022 will begin to shift to large markets, large tracks and projects that can be expected to be commercialized, and high investment in the field of materials and IC manufacturing has become the focus, and the previously highly sought after chip design links are unexpectedly “cold”. Future opportunities are more in high-end chips represented by automotive grades, involving semiconductor equipment and materials with supply chain security.
Source: Core Starling After the rapid growth of the past few years, various segments of the semiconductor industry have been basically tapped by investment institutions, and the hot rotation in 2023 will be ‘commercial landing’. In the past few years, with the wind outlet and concept, the track and corresponding projects sought after by capital, whether its development meets expectations, and whether the product can truly achieve commercial landing, will be the focus of investment institutions in the next step. 3. Market correction, chip delivery cycle continues to decline In 2022, the global average chip delivery cycle growth rate continued to decline, of which the shortening of chip delivery in the second half of the year was particularly obvious, once falling to 24 weeks in December, the largest monthly decline since 2017. On the whole, the long-standing supply chain problems have been alleviated, and the industry has entered a new inventory adjustment cycle.
2020-2022 global chip delivery review Source: Susquehanna Financial Group From the perspective of key chip suppliers, the delivery time and price of various sub-categories in 2022 have generally decreased, and products represented by analog and storage have fallen the most, and automotive regulations and industrial control have maintained a high prosperity. Specifically: among MCU products, the volume and price of automotive-grade products represented by ST, NXP, Infineon, etc. have risen, but consumer/general categories such as TI and NXP have shown a certain downward trend.
2022 MCU delivery review Source: In the FPGA products sorted out by Future Electronics and Chipstarling, the delivery time of the head manufacturers has been further lengthened since 22Q1, and the supply has not improved so far. For specific reasons, benefiting from emerging demand such as communications, automobiles and data centers, the gap in FPGA demand continues to expand, and Intel and AMD have successively announced FPGA increase plans.
2022 FPGA delivery review Source: Among the analog products of Future Electronics and Chipstarling, the supply of core manufacturers such as ADI and ON Semi tends to be stable, including signal chains, switching regulators and other previously popular categories have certain signs of relief.
Source: Future Electronics, Starling finishing and storage products, this category belongs to the category with the most obvious downward trend in 2022, and the destocking of the industry is still continuing, and the downward trend is expected to maintain in 2023. In addition to Samsung, including Micron, Kioxia and SK Hynix, etc. have plans to reduce production/reduce expenditure.
2022 memory chip delivery review
Source: Future Electronics, Silicon Starling sorted out communication chip products, the overall delivery period and price increased steadily, among which Wi-Fi and Bluetooth products market attention is high.
2022 communication chip delivery review Source: Future Electronics, Silicon Starling sorted out automotive products, high-voltage MOSFETs and IGBTs represented by categories have maintained a high degree of popularity, Infineon, ST and other manufacturers have strong demand for material number terminals, and channel prices are relatively stable overall.
2022 MOSFET and IGBT delivery review Source: Future Electronics, Starling, under the superposition of various factors, the volatility of the chip supply chain in 2022 is stronger and more uncertain than before. 2. 2022 procurement and distribution annual review In the past year, the component distribution industry was affected by the cyclical adjustment of semiconductors and returned from fanaticism to rationality. The industry is facing a cyclical inflection point, which also means new challenges and opportunities. 1. Orders and inventory of head manufacturers From the perspective of enterprise orders and actual inventory, the head original manufacturers are facing high inflation and high inventory impact, memory chips, driver chips, consumer MCUs and analog products represent manufacturers with high inventory fluctuations and risks.
Note: High > high> general/stable > low> low > no source: Silicon Starling sorting 2, market shortage key manufacturers and categories In 2022, automotive-grade and industrial products still occupy the categories with high annual popularity; In terms of enterprises, demand from manufacturers such as TI, Infineon and NXP remained strong, ST and Qualcomm fluctuated greatly in the year, and Renesas and Onsemi weakened in the second half of the year.
Source: Silicon Starling Collation 3, Annual Rise and Fall Categories/Manufacturers Affected by weak terminal demand, superimposed on many uncertainties such as trade disputes and the epidemic, memory chips, driver chips, consumer MCUs and analog products have become categories with large annual declines. Cyclical fluctuations in supply chains may be stronger than ever, and uncertainty is increasing.
Source: Silicon Starling sorted out the automotive grade still occupies the annual key price increase list, including automotive-grade MCU, MOSFET, IGBT and PMIC and other products demand to maintain a high prosperity, as new energy vehicles continue to break out in 2023, the future market growth of the automotive-grade category can be expected.
Source: Chipstarling 4, 2023 head manufacturers development focus analysis In 2022, affected by the differentiation of demand for consumption/home appliances and automotive electronics/industrial control/new energy, the chip market demand pullback trend is clear, and artificial intelligence, automobiles, new energy and industry have become the focus of the head original manufacturers. Specifically, mobile phone manufacturers represented by Qualcomm and MediaTek are focusing on transforming the smart car market, traditional PC giants such as Intel, AMD and NVIDIA are focusing on data center and automotive market applications, and automotive, industrial and communications are still the focus of traditional original development strategies such as TI, ST, ADI and NXP. In terms of domestic manufacturers, they mainly make breakthroughs in low-end markets such as smart homes and consumer electronics, and actively deploy domestic substitution in automobiles, industries and other fields.
Source: Core Starling sorted out the above, on the macro environment, or specific to the delivery trend of each enterprise shows that the “good days” of the component distribution market in 2023 are disappearing, the downward trend is becoming more and more significant, and the uncertainty factor is increasing. Starling suggested that in the face of an unstable market environment and supply and demand relationship, in the actual operation process, customers and enterprise procurement personnel can evaluate their actual needs and product market trends. In addition, you can try to view the price, inventory and delivery time of the corresponding products in Huaqiang Mall to deal with the changing risks and opportunities in real time. 3. Semiconductor supply chain combing in 2022 In 2022, the semiconductor market has shown a cyclical adjustment of “terminal demand differentiation→ industrial chain inventory ring enlargement→ pessimism brewing→ inventory delocalization accelerating→ spot market ice and fire”, and all links of the supply chain have been affected or are being affected. It is expected that the destocking of the supply and demand chain in the market before Q2 2023 will continue, and it is expected to usher in an improvement in the second half of the year.
Source: Chipstarling 1, upstream: inventory deregulation transmitted to the equipment link, ushering in a new round of capacity adjustment Since the beginning of 2022, affected by terminal demand, the market of vehicle regulations/industrial control and consumer original manufacturers has been polarized, and the inventory deregulation adjustment has gradually been transmitted from packaging and testing to upstream equipment and materials. From the perspective of equipment and materials, from the beginning of the year of short supply to the end of the year ushered in the transformation of layoffs and order reduction.
Source: Silicon Starling Sorting From the perspective of manufacturing and packaging and testing, since 2022Q1, the performance of domestic and Taiwan small and medium-sized packaging and testing factories has been warned and the production capacity of the manufacturing end has been comprehensively reduced in the second half of the year.
Source: Silicon Starling 2, Midstream: Distribution agent performance growth slows down, indicating changes in the industry prosperity component distribution industry, as an intermediate link connecting the upstream and downstream of semiconductors, has always been regarded as the industry “barometer”, and the thin profit makes component distribution extremely sensitive to the supply and demand of the semiconductor market. Since 2022Q1, the revenue growth rate of top distributors has decreased by a certain amount compared with the previous month, indicating an inflection point in the industry prosperity. Throughout the year, the revenue and profit of the top distributors have increased, but the large distributors maintain a conservative forecast for the performance growth in 2023.
Source: Silicon Starling Finishing 3, Terminal: Demand is divided into two levels, and the industry has entered an adjustment period From the perspective of major terminal demand in 2022, consumer manufacturers represented by Apple, Samsung and Lenovo have significantly reduced their orders and production capacity; New energy vehicles represented by BYD and Tesla, photovoltaics/energy storage represented by Sunshine Energy and Deye Co., Ltd. are leading a new round of industry expansion cycle; Server, industrial control and communication demand remained stable and rising.
Source: Silicon Starling sorted out the above, the demand for consumer products will be significantly reduced in 2022, new energy and other new applications are still in the stage of rapid expansion, and the supply chain will usher in a period of fluctuation adjustment, and 2023 may become a turning point in the new cycle of the industry. 4. 2023 trend outlook Looking forward to 2023, with the global economic recovery, smart cars, new energy and other emerging industries are strongly pulled, mobile phones, smart home appliances and other downstream consumer electronics market demand recovery, chip inventory continues to deteriorate, it is expected that in the second half of the year component demand side growth will drive the supply-side production capacity to gradually release, the industry will usher in a new boom cycle. In the long run, focus on the following trends: 1. Pay attention to domestic substitution opportunities after the escalation of trade conflicts Since 2022, the United States’ export controls on domestic semiconductor technology have been further upgraded, superimposed on uncontrollable factors such as the epidemic and inflation, which will affect the release of domestic chip production capacity in the short term. In the long run, benefiting from the new demand for domestic smart cars, Internet of Things, new energy and 5G communications, the demand for semiconductor components will remain strong in the next one or two years, especially the shortage of automotive-grade chips with mature processes will continue until 2023, and the replacement of imports by domestic chips will become a general trend. 2. New energy will lead a new round of industrial growth cycle Under the leadership of Tesla and BYD and other leading car companies, the development of new energy vehicles has entered a new stage, and the corresponding amount of electronic components and market scale have also risen rapidly, which is expected to lead a new boom cycle in the component distribution industry in the next few years, and it is also the general direction of domestic alternative development in the future.
Source: Chipstarling 3, component distribution accelerates digital transformation In 2022, with the increasingly fierce competition in the component distribution market, in order to collect and feedback market information more efficiently, head distributors accelerate digital upgrading, continue to transform and penetrate into e-commerce, and use the platform advantages of the e-commerce platform itself to promote supply chain reform.
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