It's cooling off and the leaves are turning yellow

Andrea Lati
Andrea Lati
  • Order activity for semiconductor equipment continued to cool off, slipping by nearly two points in the first week of October
  • All segments ended the week lower as chipmakers grow more cautious about their near-term prospects
  • Memory fundamentals have deteriorated considerably over the last few months, pressuring chipmakers to cut spending and trim utilization rates in order to reduce supply and digest soaring inventories
  • The ongoing correction in the memory market is not surprising—we have been warning of a deteriorating market backdrop since late April—however, the magnitude of the correction is steeper than expected
  • The logic market is also encountering headwinds on multiple fronts and is expected to slow down even more in Q4
  • On the equipment side, Assembly and Test manufacturers have already felt the impact of a slowing semiconductor market in 2H22, while WFE suppliers have been somewhat insulated due to strong bookings and long lead times
  • We expect the WFE sales to come under pressure in 2023 as the semiconductor industry works through the excesses of the COVID-19 phase
  • TechInsights’ Chip Price Performance Index continued to trend lower
    • DRAM fell
    • NAND flat
    • MPUs fell
  • Hyperscale Fabless Capex is still growing on yearly basis, but the pace is slowing

Hyperscale Fabless CapEx

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