1. Micron is reducing supply to shrink inventory next year chip production start-ups by about 20%
On November 17, Micron released a statement saying that the company will cut DRAM and NAND wafer starts by about 20% due to market demand!
Micron said, "Recently, there has been a weakened market outlook for 2023." It also noted that the supply of DRAM bits is expected to contract year-over-year, and the supply growth of NAND bits will be significantly lower than previously expected.
It is reported that in September this year, the company has said that it will cut its expenses by 30% in its fiscal year.
Commenting on this, CEO Sanjay Mehrotra said, "The company is taking bold and aggressive steps to reduce supply growth in order to limit the size of our inventory. We will continue to monitor industry conditions and make further adjustments as needed."
During the epidemic, global chipmakers were riding high as the trend toward working from home drove demand for computers and other consumer technology. However, today market concerns about inflation and recession, coupled with the trend back to the office, have dampened consumer demand, which has led to a backlog of unused inventory for memory chip suppliers' customers.
In the past few weeks, nearly all major memory chip makers have also issued warnings of oversupply and plummeting prices, and plan to cut capital spending. In Micron Technology's latest financial statement, the company also reported a disappointing result and gave revenue guidance of nearly $2 billion below market expectations.
2. Crystal Technology: Panel makers have suspended equipment purchases since mid-year
According to the Electronic Times, panel inspection equipment manufacturer Favite (crystal color science) said that display panel manufacturers have temporarily procured manufacturing equipment since mid-2022 due to falling demand and product prices.
It is reported that Favite has been developing AOI (automatic optical inspection) equipment for the production of microLED chips and panels, HDI and IC substrates, 8-inch wafers and compound semiconductors, and electronic paper (e-paper).
Due to the epidemic, geopolitics and inflation, there is a "precipitous decline" in panel end demand. According to the data, AUO, Chunghwa, LG Display (LGD) and major panel makers in mainland China all posted operating losses in the third quarter of 2022 and revised their 2022 capital expenditures downward to varying degrees.
The Q3 results show that AUO lost more than NT$100 million per day, almost doubling its loss from the second quarter, and its capacity utilization rate was only 50% in a single quarter. Q-Tron's October revenue was NT$15.618 billion, down 8% month-over-month and 41.7% year-over-year. In terms of shipments, Oct. large-size panel shipments decreased by 4.9% and small-medium-size panel shipments decreased by 6.7%.
In terms of capital expenditure, AUO has lowered its 2022 capital expenditure budget to NT$36 billion from the initial NT$45 billion (US$1.41 billion) and postponed the construction of an 8.6G LCD panel plant in central Taiwan, China. Guntron has cut its 2022 capex budget from NT$26 billion to NT$2.3-2.4 billion, and LGD has also cut it by more than 1 trillion won (US$752 million).
The panel maker's shipments are expected to drop sharply in the fourth quarter of 2022 and is conservative about its business in 2023, said the vice president of JinkoSolar.
