It’s cooling off as more fog rolls in
- Order activity for semiconductor equipment continued to trend lower, slipping to 86 degrees
- Subcon/Adv. Packaging led the decline with temperatures tumbling 8 points last week
- Even though the overall activity remains in an expansion phase, cracks are forming underneath
- There is bifurcation taking place between WFE and the Back-end
- The activity in the Back-end is cooling off considerably due to weaker market conditions, especially in the Memory and consumer-centric markets
- The Back-end is typically the canary in the coal mine and a leading indicator for the equipment and the ICs because it’s closer to the end markets
- The pullback in the Back-end is not surprising and is in line with our expectations of weakening market conditions
- TechInsights’ Chip Price Performance Index remained in a free-fall state
- DRAM tumbled
- NAND tumbled
- MPUs declined
- Inventories are surging
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