Caution rises as clouds darken the road

Andrea Lati

• Order activity for semiconductor equipment was flat last week with the overall temperature hovering at a warm 80 degrees
• Activity remains bifurcated with Memory and SOC Consumer slipping into correction territory while SOC Mobile, SOC Compute, and DAO are still expanding, albeit at a slower rate
• There is also bifurcation within the equipment market; WFE is still holding up well thanks to strong bookings and a high backlog, while Test, and Assembly, in particular, are declining substantially in 2H22
• The weakness is driven by a slowing semiconductor market, which is grappling with excesses from the COVID-19 period—both on the supply and the demand side—and also with a deteriorating macro environment
• TechInsights’ Chip Price Performance Index continued to trend lower
  • DRAM slid
  • NAND flat
  • MPUs flat
• WFE utilization remains above Test and Assembly utilization