In the past two years, the "chip shortage" has swept the world, the chip industry has continued to thrive, and major semiconductor manufacturers have announced plans to expand production.
However, since 2022, affected by factors such as the epidemic and inflation, shipments of consumer electronics products such as smartphones and PCs have plummeted, the demand for consumer chips has dropped sharply, and some chip prices have begun to fall in an avalanche. The industry is in a downturn.
Faced with the growing chill in the chip market, Micron , SK Hynix , TSMC, PSMC and many other major manufacturers have revised their capital expenditure plans one after another. Let’s take a look below.
1, Micron
At present, memory is still in a state of oversupply, and the downward trend continues. According to TrendForce's latest forecast, DRAM prices will drop another 13%-18% in the fourth quarter, while NAND flash prices will drop another 15%-20% in the fourth quarter.
On September 30, Micron, a major memory chip maker, released its fourth-quarter financial report for the 2022 fiscal year. The financial report shows that Micron’s revenue in the fourth quarter of fiscal year 2022 was 6.64 billion US dollars, fell by about 20% year-on-year, and fell by about 20%. The decline in demand for memory chips exceeded the expectations of Micron and analysts.
Looking forward to the future, Micron believes that future demand for memory chips and company operations will face more serious difficulties, and Micron will cut investment plans. It is reported that Micron has already slashed capital expenditures before, and it is now expected that the scale of capital expenditures in fiscal year 2023 will be 8 billion US dollars, which will be 30% lower than the previous year.
2, SK Hynix
memory chip market prospects are bleak, memory chip manufacturer SK Hynix may significantly reduce its capital expenditure in 2023.
At the end of September this year, according to Korean media reports, SK Hynix has revised its orders for next year to equipment manufacturers, and may significantly reduce equipment investment plans next year, and capital expenditures in 2023 may be significantly reduced by 70%-80%. So far, SK Hynix has become the memory chip manufacturer with the largest capital expenditure correction.
3, TSMC
Recently, TSMC fired the first shot of wafer foundry capital expenditure reduction.
On October 13, at the third-quarter law conference, TSMC said it would lower its capital expenditure this year to $36 billion. It is understood that TSMC’s original planned capital expenditure at the beginning of this year was 40-44 billion US dollars, which was adjusted to nearly 40 billion yuan in the second quarter legal meeting. Compared with the estimated value at the beginning of the year, it is equivalent to a downward revision of 20%.
As for capital expenditure in 2023, Huang Renzhao, TSMC’s chief financial officer, said that it is still cautious about customer demand, but will ensure that it can support the long-term structural growth of customers. After
4 and PSMC
TSMC lowered its capital expenditure, PSMC chose to follow up.
PSMC said that due to the shortage of manpower in clean room and mechanical and electrical engineering, the extension of equipment delivery and the adjustment of capacity planning in response to market conditions, this year’s capital expenditure will be revised down from US$1.5 billion to US$850 million, a drop of up to 43%.
In general, the current overall chip prosperity continues to decline, and market pessimism is spreading.
The industry believes that subsequent IDM factories including Samsung , Intel , and wafer foundries such as UMC and World Advanced will also lower their capital expenditures to survive the market downturn.
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