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November 2, 2022

The Greensheet: October 2022

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IC

Volatile supply causes extensive lead times for NXP, Melexis and Infineon, but Microchip sees some improvements 

Lead times continue to stretch for NXP’s MCU and MPU series. Standard lead times are now sitting at 40 – 50 weeks, with the MC series hovering around 52 weeks, and some series rising above 60 weeks. The most constrained series for manufacturers is the MCIMX6G, which is on allocation at 99 weeks. 

Similarly, availability of Melexis’ MLX811 series, primarily used for ambient lighting in vehicles, is constrained, as demand from automotive customers continues to rise. No delivery dates or exact lead times can be confirmed at this time and there is currently no backlog to support orders. Lead times for this series are now extended to 52 weeks. 

For Infineon, tight supply on IPD, MOS and BTS switches is said to be easing, as stock levels begin to increase. However, the following parts are seeing deepening shortages: 

  • BSC 
  • IPP/IPD high voltage MOSFETs 
  • TEL high voltage drivers 
  • SAK MCUs 

Predictions indicate that these components will not see any improvements in supply until Q2 of 2023. Distributors are no longer accepting new orders and are unsure when booking can resume.  

In comparison, Microchip MCP series lead times have decreased as production has replenished stock levels. PIC12 and 16 series lead times have improved to 8-12 weeks while the PIC24 and 25 series remain short in the market at upwards of 20 weeks. 

There is still a high chance of delays, and customers have been advised that cancellations are allowed for orders being pushed out – but only if the postponements impact production timelines. 

Power outage in Japan affects Toshiba production 

According to a statement made by Toshiba Electronic Devices & Storage Corporation, a power outage occurred on September 11th at a Toshiba plant in Japan. The outage occurred during an examination of power facilities and resulted in a production shutdown. 

The facility mainly manufactures general-purpose MCUs used in consumer goods and automotive equipment. Reports state that the power loss did not harm the manufacturing machinery and Toshiba has steadily been working to resume full production.  

However, according to local media the power interruption would result in some semi-finished goods from the temporarily paused production line to be scrapped. It is estimated that shipments to customers will be affected as resuming production is a slow-moving process. 

Affected series include: 

  • Toshiba Arm Cortex-M4 core – Part number TMPN4XXX, Arm Cortex-M3 core U- Part number TMPN3XXX 
  • Toshiba automotive power amplifier IC - TB209, TCB70XXX, TCBXXX, TB900XXX 
  • Toshiba Power Management and MOSFETs – Part numbers starting with SSM3, TC75, TPC80XXX, TPH4RXXX, TK40SXXX 
 

 

CPU

AMD launches new products and generates increased demand for CPUs 

AMD announced the Ryzen 7000 series (Raphael, Zen 4, LGA AM5 socket, TSMC’s N5 5nm node) would be available on September 27th. There are currently only 4 high end models being introduced (Ryzen 9 7950X, Ryzen 9 7900X, Ryzen™ 7 7700X & Ryzen™ 5 7600X), but it is likely that more mid to entry level models will be revealed and launched in the future. 

Customers switching over to this component will require a new motherboard and set of DDR5 memory – as there is no backwards compatibility with the DDR4. It has been years since AMD introduced a new generation CPU, but experience indicates when a new motherboard is needed, demand increases for predecessor and next generation CPUs. Customers who require new CPUs should be mindful of how the demand will impact supply. 

 

 

Hardware

SSD supply outpaces demand to create cost savings opportunities 

A decrease in orders for SSDs has created a softening market, with pricing trending lower within the past couple of weeks. Most customers are seeing cost saving opportunities across the board with manufacturers, including parts like industry high runners 240GB and 480GB SATA models. 

Stock has increased for the Samsung PM883 series, with open market rates around 10 – 15% lower than official manufacturer pricing. Supply constraints for the previously short S4510 are also easing, with prices improving by around 5 – 10%. Inflated inventories of storage components are similarly plaguing Intel, which is now looking to decrease stock to leave room for price negotiations within higher quantity demand. 

Customers should take advantage of the buyer’s market now in case demand spikes again in the future. 

Forecasts are still grim for memory modules 

Despite demand not improving within the memory module market, manufacturers are still trying to push vendors into larger orders. This has resulted in vendors holding higher inventories. In turn, vendors have no choice but to offload the parts at a loss, which has been reflected in the market as rates have dropped as much as 10 - 20% from official pricing. 

There are still pockets of transactions, but the volume per order is becoming much smaller. Customers are trying to back away from ‘just-in-case’ inventory methods, instead opting to only buy from the open market when demand deems it necessary. 

Orders will likely only increase in the open market when demand returns, which is not predicted to change in Q4. Forecasts report that the memory module market is unlikely to pick up until the middle of 2023. 

Fluctuating demand leads to oversupply for some network adapter cards 

Consumption of available supply has slowed for the Mellanox MXC5 series (particularly 25GbEs speed models) which has resulted in oversupply. Market prices have now reached rock bottom with limited space to drop any further. Customers are refraining from increasing shipments and reports foresee it will take another one or two quarters for the market to digest the current overstock. 

Demand is much stronger for the MCX6 series, with no significant supply improvements. There will be limited availability in Q4, but it will likely take another full quarter to see a complete recovery.  

Direct supply from the manufacturer for the discontinued I350T2V2 is very inconsistent. Distributors are unable to advise on any shipment schedules and are continuously waiting for Intel to update them on allocation. Alternatively, supply for I350T4V2 is sufficient to meet market demand and prices have dipped below the cost of the I350T2V2. 

Uncertainty reigns in GPU market thanks to soft demand 

Demand for GeForce GPUs is much lower than expected, which has caused a ripple effect in the GPU market as manufacturers reconsider their forecasts. To mitigate a price hit on the new RTX4090 GPU launching within the next month, Nvidia recalled chipset stocks for RTX3090, RTX3080Ti and RTX 3080 12GB from their AIC partner. This will help reduce competition amongst GPU models, plus it will prepare the market for new model launches as the RTX 30 series continues to be phased out. 

In other news, Nvidia’s partnership with the company EVGA has come to its conclusion. Historically, EVGA has manufactured the GeForce-based video cards for Nvidia, but the business is now pivoting away from GPUs and instead will be focusing on more profitable products. EVGA will temporarily provide support for the older GeForce GPUs, such as the RTX 3000 series, but once stock is depleted the partnership will end.  

New United States’ license requirements impact NVIDIA and AMD 

The U.S. government has imposed a new license requirement that sets restrictions on NVIDIA and AMD’s exports of advanced GPUs to China and Russia. This rule, effective immediately for any future shipments to China, including Hong Kong, has impacted the forthcoming H100 integrated circuits. DGX/EGX/HGX systems, which incorporate the A100 or H100 chips, and the A100X are also covered by the new license requirement. 

Impacted Nvidia GPU models include: 

  • A100 Accelerator Card 
  • H100 Accelerator Card 
  • A100X Converged Accelerator Card 
  • Full systems that incorporated A100 such as Nvidia DGX A100, Nvidia HGX A100, Nvidia EGX A100 
  • Full systems that incorporated H100 such as Nvidia DGX H100, Nvidia HGX H100, Nvidia EGX H100 

Regarding the Chinese market’s demand, buying power is mostly in the prominent technology companies’ hands. Companies like Huawei, ZTE, BAT etc. are leading industry demand, but the current macroeconomic situation is not favorable. Project cancellations and slashed projections show that customers are spending conservatively and basing orders off immediate needs. 

Prior to the announcement the A100 80GB model was in oversupply, but now vendors are holding inventories and not releasing new shipments or quotes as they anticipate a surge in demand. Market activity has consequently increased, as inquiries come in from both end customers and brokers, and most open market availabilities are selling quickly. 

Speculation is market prices will continue to rise, not only for the restricted models, but other GPUs as well – especially the Tesla series for data center and AI computing.

Ethernet controller chipset supply remains constrained while price increases cast doubt on demand forecasts for Intel 

Despite overall support from Intel improving on the Ethernet Controller I210 Series and Ethernet Controller I211 Series, Ethernet Controller I210-IT (WGI210IT) supply allocation remains tight. Open market availability on Ethernet Controller E810 is also limited and the entire series is facing long lead times. 

Intel’s price increase will go into effect on October 2nd, 2022, and it is uncertain what effect this will have on support from Intel and demand from customers.  See below for an overview of what products will be impacted by the price increase.  

Intel Product (BU)  

Q4 List Price Increase  

Xeon CPU & Chipset  

Xeon SP: Bronze & Silver - 5%, Platinum & Gold 7% - 10% Xeon D: 2-10%  

Xeon E: 5%   

Chipset: 7%   

Atom: 2:5%  

Client CPU& Chipset  

Mobile SIPP Processors 0% (no increase)  

Other Core Processors 10%   

Pentium, Celeron and Atom 20%   

Workstation Xeon W 10%  

Client and Workstation PCH 10%  

NUC  

Intel NUC (Core based) 3-9%   

INTEL NUC (Celeron/Pentium based) 2-20%  

 

Additionally, China’s annual Golden Week will be taking place from October 1st – October 7th. Observation of the holiday could result in a backlog of orders and constrained supply; therefore, customers should be mindful of this possible outcome and try to increase buffer stock of critical components. Those looking for cost savings opportunities should place orders early, that way future price surges can be avoided.

 

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