The IC design industry is conservative in purchasing goods, and the peak season in the third quarter fails

July 24 news, due to the market recovery less than expected, TSMC in last week's meeting again lowered the global wafer foundry output value and TSMC's annual performance expectations. At the same time, TSMC also believes that the inventory of IC design customers is expected to reach a healthier and lower level by the end of the fourth quarter of 2023. Subsequently, a number of IC designers also privately said that at present, customers are more conservative, and the demand for price cuts is greater, and the second half of the year can not expect the traditional peak season effect, and the peak season is not a foregone conclusion.

According to Taiwan media reports, a large IC design factory said that even TSMC's view of the second half of the year is relatively conservative, and the annual outlook is revised down twice, which can see how depressed the semiconductor economy is. And TSMC order source is IC design factory, "TSMC are conservative, IC design industry is really difficult!" .

Affected by inventory adjustment, the operating performance of IC design factories in the first half of this year generally declined, and the performance of many manufacturers in the first half of the year was reduced by two to 40% compared with the same period last year, and few companies maintained growth compared with the same period last year. Originally, IC designers hoped that the economic recovery in the second half of the year could help pull back the annual performance of this year, but as the market demand has not increased significantly after entering the third quarter, the hope is increasingly dim.

Some IC designers pointed out that after a period of inventory digestion, by the end of the second quarter, the absolute amount of inventory has been reduced a lot, although it is not yet said that it has returned to a healthy normal level. Only the scale of revenue has also become smaller, so from the perspective of inventory turnover days, it will not necessarily be significantly reduced.

The most critical is that the recovery of terminal demand is slower than expected, and we are cautious about the current situation and the lack of consumer confidence in the market. This also makes the downstream channels and customers do not dare to stock up, many customers require price cuts, otherwise they do not want to pull goods, but they can not give a big order. IC design factory try not to sacrifice gross profit or even sell at a loss, otherwise not only the revenue is not good, profit performance may also be very bad, so the current order on both sides a little stalemate, resulting in the third quarter of the situation is not clear. The peak season effect completely failed.

Because the market expectations are generally poor, customers are not in a hurry to place long orders, orders are usually short orders, and now the order visibility is actually full of low. The order demand can not rise, the amount of film will not be much.

There are rumors that a major IC design factory in the mainland has slashed the amount of wafer foundry investment in the second quarter, revealing a conservative and pessimistic view of the second half of the year.