Govt Tech Controls & Chip Slowdown

G. Dan Hutcheson

The Chip Insider®

The Greater Geopolitical Messaging of U.S Government Technology Controls:
A few weeks ago the U.S. Government put Export Controls on EDA and Wide Bandgap Substrates. Then they blocked Nvidia & AMD from selling advanced AI chips in China. It would be easy to see these as isolated events, but I do not believe they are. Here’s why it’s … As an industry, we need to develop a common global position where companies agree to support each other. I can’t speak for the industry or the companies. But I do believe we will be stronger as a group.

General recognition of the Chip Industry Slowing:
It started … said the industry was entering a “down cycle.” Currently, we’re more than two-thirds of the way through the third quarter and many are commenting on how sharp the turn came… Early warning signs are typically dismissed as anomalies, as confirmation and desirability bias get the best of us. This cycle has been particularly troublesome because of the extreme shortages of 2021. So, early weak sales growth was often more due to lack of components than lack of demand. This was particularly true in the first half of the year. During this time, Occam’s Razor failed us... As usual, DRAMs were the canary in the downturn coal mine. They stopped singing as early as ... Over this time, More Moore Foundry went from Tight to Glut over the course of five weeks. More than Moore Foundry and OSAT went from Tight to Saturated over the course of three weeks … This was the sharpest turn we had ever seen. It set a very dark trend for going into the third quarter… So, we’re in this unusual situation of supply chain disruption and weak demand – two conditions that are normally mutually exclusive.

“When everything seems to be going against you … remember that the airplane takes off against the wind” — Henry Ford

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