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March 18, 2022

The Greensheet: February 2022

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IC

Ongoing issues persist in IC market

Due to ongoing industry-wide supply constraints, lead times for integrated circuits (ICs) increased dramatically across the board. In particular, lead times have stretched up to 70 weeks for various automotive grade and industrial grade ICs. In some cases, distributors are unable to confirm their contracted allocations, and some are reporting they will not receive some part deliveries until 2023.

TSMC’s $100 billion growth plan

Taiwan Semiconductor Manufacturing Company’s (TSMC) production capacity is expected to remain tight throughout 2022. However, to accommodate the ongoing component demand, the manufacturer is planning to invest $100 billion over the next three years. This will go toward new fabrication plants – one in the US and another in Japan – to increase production capacity for its silicon wafer business.

TSMC has already increased its costs by 10-20% for mature and advanced process nodes. The rising foundry costs are anticipated to affect CPU, GPU and ASICS pricing. AMD, Intel and Nvidia are among manufacturers that depend on TSMC’s advanced node technology according to Tech Wire Asia.

Broadcom Inc. continues its incremental price increases

Twice within the last year, Broadcom Inc. has increased its pricing on the BCM series by up to 20%. The cause is mostly due to wafer issues and insufficient supply. To implement a more cost-effective manufacturing plan, Broadcom has used these incremental price increases to encourage customers to switch to newer series. This business practice allows the production factories to adopt updated technologies, which will increase efficiency in production.

As this pricing strategy is applied across Broadcom’s products, it will then trickle down its supply chain, affecting lead times. Currently, the lead times for Broadcom BCM series is 54 weeks.

NXP automotive parts shortage continues, resulting in additional price increases

NXP has increased price by 20% on its automotive parts. Another price increase of 30% is expected to be implemented by June 2022.

NXP Tianjin, its China production factory that focuses mainly on MCIMX series MCUs, has been affected by a recent mandated COVID-19 lockdown. As a result, lead times may stretch beyond the current 52-week time frame for automotive parts.

Bosch sensor lead times increase – customers seeing little support

Lead times for Bosch sensors have started to stretch, particularly impacting low-power application sensors optimized for smartphones and wearables. Current open orders are not seeing support from Bosch. The affected series includes BMA253, BMA400, BMA456, BMA422.

Analog Devices, Inc. and Maxim Integrated delayed acquisition impacts lead times

The lead time for Analog Devices, Inc. (ADI) MEMs sensors is currently 60 weeks but pricing remains stable.

ADI’s acquisition of Maxim Integrated is delayed, which has reportedly led to lead times increasing up to 90 weeks for some Maxim parts. Maxim’s DS series lead times have stretched to 70 weeks.

Delays are anticipated to persist following limited factory operations in Asia during the Lunar New Year (Feb. 1-10). These expected delays, as well as limited wafer output to support some parts’ builds, will add to supply constraints.

Xilinx prioritizes tier 1 customers

Xilinx’s production capacity remains in a critical state with no signs of improvement. This has led the manufacturer to shift its support to prioritize global tier 1 customers. The segments that have secured support include aerospace, military, and the US government.  In addition, no new orders are currently being accepted, leaving 2022 backlog orders uncertain in an already shaky market.

 

PASSIVES

Murata’s global distribution reduces disruption impact

Murata’s production capacity allocation is distributed among its various factory locations. This reduces the disruption to its operations when one location experiences a disruption, such as the recent COVID-19 outbreak at its Fukui Takefu Plant in Japan. This plant accounts for 20.7% of Murata’s production of high-end consumer MLCCs. However, the suspension of some lines due to the outbreak had limited impact on overall operations in the short term.

While Murata’s disruption prevention measures have been effective, the manufacturer is still significantly hampered. This has resulted in a halt to all new orders and further extensions to lead times.

 

MEMORY

Parts shortages impact DDR5 memory module production

Since January, there has been an increase in demand for DDR5 memory modules. However, DDR5 manufacturers have yet to fully ramp up production; therefore, supply for these next-gen memory modules is limited. Tight production and distribution have resulted in open market pricing being at least 30-40% higher than the official pricing. The shortage of PMIC and VRM components, which are needed for DDR5 builds, will likely dampen supply availability according to reports.

 

STORAGE

A wary outlook for Intel SSD customers

Due to tight supply, the market price for small capacity 240GB/480GB SSDs remains high. As a result, manufacturers have not been able to allocate certain SSD series to customers – for example, Intel P4510 and P4610 series are affected. 

Intel also announced it will no longer manufacture the S4510 M.2 240GB and 480GB SSDs, which have been in high demand. As it phases out this series, Intel will only fill orders for tier 1 customers.

 

Micron to discontinue 9300 Max SSDs amid shortage

Micron is expected to discontinue its high-end 9300 Max series SSD due to component shortages. The final shipment of this series is mid-2022. Alternative models include the Intel P4610 and the Samsung PM172b, which have also been in shortage.

 

Hard Disk Drive demand increases in Q1 2022

HDD demand in China is on the uptrend. For major HDD brands Seagate, Western Digital and Hitachi, the 8TB SATA HDD was the market high runner in January. OEMs have reported that supply for 8TB capacity HDD is becoming unstable and Seagate lead times have stretched from 16 to 18 weeks. 

 

 

CPUs

AMD customers to expect upcoming price hikes

AMD is reportedly raising prices across its EPYC data center processor product line by 10-30%. The price is anticipated vary by customer. Increased pricing and unclear delivery dates are seen across AMD’s CPU products as the manufacturer faces operational setbacks. These impediments are due to the manufacturer’s reliance on outside firms to provide wafer and packaging capacity. 

Intel Ethernet Chipset Update

The foundry price increases have led to Ethernet chipset price increases. This is seen in the adjusted price of Intel Ethernet chip series, which includes the 210IS, 210IT and 210AT chips.

 

Additional Intel affected series include:

WGI210IT 
WGI210AT 
WGI210IS 
WGI211AT 
WGI219LM 
FTXL710-BM1 
FTXL710-BM2 
FTX710-BM2 
 

GPUs

Nvidia’s GPU availability will remain tight following the Lunar New Year

For Nvidia’s GeForce series, including RTX 3070/3070Ti/3080/3080Ti/3090, continue to see supply shortages. Some suppliers have reported more stock for RTX 3090 Ti, which was expected to be released prior to Chinese New Year but supply will remain tight on this high demand GPU. 

NVIDIA surprised many with the launch of “entry level” RTX 3050 with shipments beginning at the end of January 2022.

 

FINISHED PRODUCTS

Mellanox supply constraint continues across various finished products 

 Mellanox manufacturing lines remain constrained resulting in lead times to stretch to 2023. In particular, supply issues across Mellanox network card series are likely to continue as well.

As a result, we are hearing OEMs and other manufacturers in China are shifting to the Intel and Broadcom network cards as alternatives to Mellanox. 

 

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