Chip price cuts are like a cold wind, and every link in the industry chain feels the cold more or less. “The cold winter is coming.” Talking about market changes, on August 25, chip trader Liu Lin (pseudonym) sighed to a reporter from Times Weekly. Liu Lin, who has experienced market prosperity, is now a little difficult to do business. He has only opened a small order with a profit of less than 3,000 yuan in the past month. Compared with traders, manufacturers and equipment manufacturers in the supply chain should be more calm. “It will definitely have a certain impact on the company, but it is still within the controllable range.” On August 22, Fan Yue (pseudonym), an insider of a listed company that specializes in chip research and development and production, told the Times Weekly reporter.
Recently, a related equipment manufacturer told the Times Weekly reporter that due to the relatively long service cycle of the equipment, the company will be relatively less affected in the short term. Right now, this round of chip price cuts is still going on, and how long will it last? still unknown. Industry insiders reminded that in the future, the competition of wafer foundries will be more intense, and more and more small chip design manufacturers may face the risk of bankruptcy. The downward pressure is transmitted to the upstream of the industrial chain. Liu Lin is a group of people in the chip industry who felt the market cooling earlier. Compared with the “surging sky” of chip prices a year ago, the current chip prices have fallen, and the sales situation is hard to say for him. “I used to be so busy every day, but now I have nothing to do.” Liu Lin’s tone was a little helpless. The recent drop in the price of some chips in the retail market caught him by surprise. The chip market suffered a sudden price drop, and traders were the first to bear the brunt. Liu Lin told the Times Weekly reporter, “Although the prices of some chips that are in short supply are still high, the prices of some consumer electronics chips have fallen sharply. Now the overall market is oversupplied, and our business is difficult to do.” “When the market was good in the past, I was able to help the company earn more than 300,000 yuan just two months after I joined the company. However, in the past month, I only opened one order and only had a profit of less than 3,000 yuan.” Facing the huge gap , Liu Lin is somewhat difficult to accept. Liu Lin said that his company has been affected even more. The recent sales data has been bad, and the performance has dropped by nearly half. In two months, people have left one after another, with a total of more than 40 people. In addition to traders, other links in the chip supply chain are also inevitably affected. Fan Yue told the Times Weekly reporter that price fluctuations in the retail market will definitely have a certain impact on the company. The company’s business mainly focuses on mid-to-high-end chips, and the proportion of mid-to-low-end chips in the company’s products is only about 30%. At present, mid-to-high-end chips are still relatively popular in the market.
Recently, some industry insiders familiar with the chip industry chain reported to the Times Weekly reporter that as market demand decreases, chips that cannot be sold will naturally start to be discounted. Enterprises hope to realize cash as soon as possible, and a longer inventory cycle will affect production. Some small start-up chip production companies and companies with large initial investment costs may be more difficult to withstand the impact of falling market prices. In this context, related semiconductor equipment companies have also been affected to some extent. On August 24, an internal salesperson of a semiconductor equipment company told the Times Weekly reporter that the company mainly provides equipment for chip manufacturing. Affected by the decline in chip market prices, the company’s order volume has declined recently, and low-end equipment has been affected more. The impact of some high-end devices is relatively small. “At this stage, the price reduction of chips will have an intuitive impact on semiconductor manufacturers or packaging and testing plants, but for equipment companies, because the use cycle of equipment is relatively long, the current market changes have not directly affected us.” On August 25, another An industry insider engaged in semiconductor equipment told the Times Weekly reporter. Or force the enterprise to upgrade. Although the current situation is not good, many colleagues choose to “get out of the car”, but Liu Lin still chooses to stay. “The development of the industry will not always be booming. There will always be a group of people who leave, and a group of people who will choose to wait for the next wave of the market.” Liu Lin said.
Regarding the development of the domestic chip industry, Liu Lin’s attitude is more optimistic, “the recession is temporary.” During an interview with a reporter from Times Weekly, many industry insiders also said that the current drop in chip prices is just a normal correction relative to the skyrocketing prices in the previous two years. In the long run, there is still a lot of room for growth in the development of mid-to-high-end chips. “The decline in prices is not necessarily a bad thing for industrial development.” Fan Yue told the Times Weekly reporter that on the other hand, this can drive the cost of products down and improve the quantity and quality. In the face of changes in the market, some companies will take the initiative to choose to respond. Through technological innovation and iteration, they will gradually increase the yield rate later, so as to control costs well, which is actually a benign promotion for the development of the industry. effect. In this regard, Liu Yuan, chief analyst of IC TIME, also believes that the decline in upstream foundry prices will affect the profit margin of foundries. losses from a drop in demand. However, Liu Yuan also pointed out that in the future, the competition of wafer foundries will become more intense, the survival pressure of small fabs will increase, and the profits of large fabs will decrease. In this case, more and more small chip manufacturers may face the risk of bankruptcy. Facing the cold winter of the industry, what people are eager to know is how long this round of price cuts will last? How should companies in the industry chain respond? Liu Yuan believes that this impact may last for more than a year. For enterprises, Liu Yuan suggested that, on the one hand, the mature process field can develop characteristic processes and shift the focus to more profitable foundry fields such as automotive chips; on the other hand, develop advanced processes, improve performance, increase selling points, and satisfy the market. The need for application upgrades to reduce losses due to market fluctuations. In this regard, Major General Ding, the founder of Nail Technology, also told the Times Weekly reporter that on the whole, the adjustment effect of demand on supply will be reflected in the chip market. With its own strength, it needs to make more structural adjustments and tilt towards the direction of market demand.
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