Latest MCU chip Q3 spot market analysis and prediction

【Lansheng Technology News】According to the latest financial reports of the world's major MCU original manufacturers, judging from the trend of industry inventory since this year, it is basically certain that 2023Q1 will reach the peak of industry inventory, Q2 will slowly pull back, and Q3 will decline relatively significantly, but the overall inventory is still relatively high. Domestic manufacturers focusing on consumer products (including Taiwanese manufacturers) have basically stopped their price wars, indicating that the industry's price reduction and destocking cycle has improved, corresponding to the current rebound in demand for smartphones, PCs, etc.

We all know that the main demands of leading MCU manufacturers represented byInfineon,NXPandSTare concentrated in the automotive/industrial field. Chinese manufacturers such as Holtek (Holtek) of Taiwan, GigaDevice and Zhongying Technology mainly focus on consumer products. Based on the comparison of the average inventory of leading manufacturers and Chinese manufacturers, it can be clearly seen that the inventory of consumer MCU is basically more than twice that of conventional materials. Although the price war has stopped in the industry, inventory depletion is far from over. In the future Market volatility will continue. Looking at the inventory trend of leading MCU manufacturers, we can see that automotive/industrial MCU inventories are on the rise. Combined with TI's latest financial report information, industrial MCUs have the risk of excess. Automotive demand is relatively stable, but there are rising inventory fluctuations.

Delivery times continue to shorten and overall supply stabilizes

Judging from the regular delivery cycle of MCU, compared with normal years (around 14-20 weeks), mid- to low-end products represented by Renesas and ST have achieved normal supply. Regarding 32-bit MCUs, delivery times continue to shorten and spot market prices stabilize. In terms of automotive MCUs, market demand remains high, delivery times fluctuate to a certain extent, spot market prices gradually stabilize, and some products are priced higher.

According to the monitoring of MCU products by Lansheng Technology in the past two months, the prices of mainly domestic automotive categories such as ST, NXP andTIhave all dropped to a certain extent. Some products have experienced price inversions. Although the overall price has fluctuated, the downward trend is obvious.

Overall, MCU supply and prices are gradually improving, and automotive materials have improved significantly.

Leading manufacturers are under pressure, and consumption recovery appears

Judging from the latest average revenue growth rate of manufacturers, the industry's decline has narrowed and there is a certain rebound momentum. Specifically for leading MCU manufacturers, the average revenue growth rate has a downward trend, which is mainly affected by weak industrial demand. At the same time, automobiles are also affected by certain fluctuations. For Chinese manufacturers, the revenue decline has narrowed significantly, but there is still considerable room for adjustment, and future recovery expectations remain to be continuously observed.

From the perspective of MCU downstream demand, the demand for automobiles, new energy, etc. is relatively certain, and the stock market of smartphones and PC consumer electronics is the key to improving demand in the future. According to IDC data, the current demand for PCs and smartphones is gradually recovering and is expected to resume growth in 2024. We are optimistic about the future growth expectations of the overall MCU market.

Judging from the current orders from original manufacturers and future expectations, demand for automobiles continues to grow and inventories have increased. Industrial demand is weak and consumption/IOT continues to improve. Looking forward to 2024, automobiles maintain optimistic expectations, and the recovery of the consumer market may be delayed to 2024Q2.

To sum up, the overall supply and demand of MCU has gradually returned to normal, prices have stabilized, and a rebound in demand may remain to be seen. We are optimistic about automobile demand, pay attention to the recovery trend of the consumer electronics/IoT market, and be wary of the risk of weak industrial/communication demand.