semiconductor noise continues, including inflation and interest rate hikes, which has not solved the uncertainty factors such as inflation and interest rate hikes, which has weak demand for consumer electronic products. Most supply chains expect that the stalemate of selling inventory will continue until the first half of next year. Under this situation, the group of customized chips (ASIC) has light inventory and high technology, and is also the key to operating growth in the fourth quarter and next year, including Creativity, Shixin-KY, Zhiyuan, etc.
IC design group generally has a rise in inventory levels in the second quarter, and will also rise in the third quarter. Most of the industry believe that inventory may be difficult to disappear by the end of the year. It was previously believed that some products have the opportunity to be driven by brand manufacturers to stimulate consumption and promotions, but there seems to be no dawn in the short term, and inventory has become a burden. Although the
ASIC group will also face the problem of customers adjusting their inventory, they themselves do not carry inventory because they provide customized products, and most customers cannot cancel orders, which has relatively a certain degree of advantage.
Most IC design manufacturers have become more conservative in chip investment chip foundries, which makes the ASIC group more productive. Shixin-KY was previously tightened by the supply of CoWoS and ABF carrier boards, so the market is optimistic. It is expected that the supply of ABF carrier boards will be slightly loose from the fourth quarter. In addition, the company plans to add new suppliers, which is expected to increase mass production operation momentum. The reason why customers of
ASIC manufacturers still have a demand for goods is mainly because most of the concentrated high-end HPC, AI, Netcom and other fields, and most of the customers are international manufacturers, with relatively stable order volume and not being hit by the consumption boom trend.
is composed of creative revenue, with non-consumer electronic products accounting for about 60%; Shixin-KY accounts for only a single digit proportion; while Zhiyuan is affected by the weak market of subsidiary Yatli MCU in the short term, but Zhiyuan's customer products are mostly niche products, which is relatively supported to a certain extent. The second advantage of the
ASIC group is its high technology, which is mostly advanced process development projects, especially Creative, Shixin-KY, which is closely related to TSMC. Judging from the revenue structure of Creative NRE, the 7-nanometer revenue contribution in the first half of the year jumped sharply from 29% last year to 43%, which clearly shows that the trend is clear.
Shenxin-KY's revenue in the first half of the year contributed 65%, up from 60% of the whole year last year. The market is optimistic. As North American customers enter mass production contribution one after another, the contribution of 7 nanometers has increased, and the NRE also has a 5-nanometer case opening contribution.
Overall, in addition to these two major advantages, the overall environment is also relatively friendly. As the China-US chip struggle continues to burn, including measures such as restricting GPU and AI exports, the market is optimistic, and the policy will strengthen China's chip autonomy trend, which will become a new business opportunity for ASIC manufacturers.
However, recently, White House officials said that the Biden administration will provide new rules and detailed information to China for exporting high-performance AI chips, and will also make ASIC companies keep a close eye on the key points. Since ASIC factories directly develop chips with Chinese manufacturers, if the ban scope is expanded to banning any high-end AI or HPC chips from being sold to China, the impact will be quite heavy, and the details of the ban should be observed in the future.
(First image source: Created by Freepik)
