Global Semiconductor Market

Negative growth for 7 consecutive months

         According to data from WSTS (World Semiconductor Trade Statistics Organization), the global semiconductor market size decreased by 20.1% year-on-year in January 2023, which is even worse than the 18.1% year-on-year decrease in December 2022.
From July 2022, there has been negative growth for 7 consecutive months, and from November 2022, there has been double-digit negative growth for 3 consecutive months. The storage market is particularly bad, with a year-on-year decrease of 58.6% in January 2023, which is even worse compared to a year-on-year decrease of 46.2% in December 2022.
Although these figures are calculated in terms of amount, in fact, they are also decreasing in terms of quantity. According to the shipment volume data in January 2023, DRAM and NAND decreased by about 40% compared to the same period last year. In other words, due to excess supply capacity, memory manufacturers can only choose between "bearing excess inventory" and "responding to price reduction requirements.". However, although reports of declining storage unit prices are increasing, the decline is not significant. The author predicts that the subsequent decline should accelerate.
The reason why the situation in the storage market is so serious is due to sluggish demand for PCs and smartphones, as well as the deterioration in the performance of large IT vendors including GAFA (Google, Apple, Facebook, Amazon).
Since the beginning of 2021, the semiconductor shortage has received widespread attention as a social issue. At that time, the shortage was for semiconductor products such as MCU, analog, discrete devices, etc. that did not require the most cutting-edge technology. So, what about these shortages beyond storage?

From "scarcity" to "excess"?

      Looking at the MCU market, the performance in January 2023 was strong, surpassing the 21.9% growth rate in the same month last year and the 14.8% growth rate in December 2022. In particular, automotive MCU sales increased by 28.2% in January 2023 and 25.8% in December 2022. The decline of semiconductors seems to have "blown away". However, the shortage seems to be coming to an end, and extended delivery times are returning to normal.
The simulated market declined 4.8% year-on-year in January 2023, down from 4.4% year-on-year growth in December 2022 to negative growth. Careful observation shows that the growth of the general analog chip market has turned negative from 8.1% in January 2023 and 3.1% in December 2022, but the performance of the automotive simulation market is very good, although it is not as good as the growth of 28.1% in January 2023 and 36.4% in December 2022.
Like automotive MCUs, the shortage of automotive analog chips seems to be coming to an end, but the situation for general-purpose analog chips may be changing from a shortage to an excess.
Literally, universal analog chips are widely used in various applications. When the global COVID-19 epidemic broke out, users were scattered around the world, and distribution networks could not operate normally, resulting in shortages everywhere, which is likely to lead to a surge in temporary demand.
In the automotive sector, smart keys are equipped with some kind of universal analog chip, which is still in short supply. The reason for the shortage may be the increase in demand, but as general-purpose analog chips have multiple applications in addition to vehicles, it cannot be ruled out that a temporary surge in demand may lead to a shortage. It is necessary for us to observe its development for a period of time.

Infineon is the key to improving the shortage of power devices

         The discrete device market grew 0.6% year-on-year in January 2023, down from 4.8% in December 2022. Careful observation shows that the small signal transistors used for current control less than 1W decreased by 31.5% in January 2023, down from 25.6% in December 2022; Power transistors of 1W or more used for current control increased by 13.9% in January 2023, down from 16.1% in December 2022, but their performance remained strong.

     Discrete devices are highly versatile semiconductors with a wide range of applications, so they are still products prone to temporary needs. In 2021, when the demand for small signal transistors surged, it was said that "the demand for all applications is increasing, which seems to be an unusual situation.". In fact, this is a typical phenomenon of temporary demand expansion. The decline in transistors related to the discrete device market from December 2022 to January 2023 is estimated to be the result of the disappearance of this temporary demand.