The Greensheet: May 2025

Key Themes

• Tariff Truce Brings Relief—But Uncertainty Lingers: A 90-day U.S.-China tariff pause is easing immediate cost pressures, but long-term risks remain. Buyers are racing to secure inventory while preparing for possible tariff reinstatements. 
• AI Demand Continues to Tighten Supply: Soaring AI infrastructure needs are straining DRAM, CPU, GPU, and SSD availability. Lead times are stretching, prices are rising, and procurement strategies are shifting to keep pace. 
• Supply Chains Realign to Minimize Tariff Exposure: Manufacturers are accelerating moves to Mexico, Malaysia, and Vietnam, while customs delays and COO policy shifts add new layers of complexity to global sourcing. 

Tariff Updates

Current State

• US-China Tariff Truce Initiated: On May 12, 2025, the United States and China agreed to a 90-day tariff reduction period. Effective May 14, the U.S. reduced its tariffs on Chinese goods from 145% to 30%, while China lowered its tariffs on U.S. goods from 125% to 10%.  
• "De Minimis" Exemption Changes: The US has also announced changes to the "de minimis" exemption, which applies to low-value parcels (under $800) shipped from China. The tariff rate on these parcels has been cut from 120% to 54%. Additionally, a planned increase in the flat fee per parcel (from $100 to $200) has been cancelled.  
• U.S. Overhauls AI Chip Export Regulations Amid Industry Pushback: The U.S. government announced plans to revise restrictive export regulations on AI chips that were set to take effect on May 15. The revision aims to balance national security concerns with the need to support American innovation.  

 What’s Next

• The Trump administration may reintroduce tariffs at any time before the 90-day pause ends.  
• While the immediate tariff burden is reduced, China's "Country of Diffusion" policy remains a significant factor for long-term supply chain strategy. US-based IDM fabs still need to consider the implications of wafer fabrication location, even if final assembly is overseas, as future tariff adjustments after the 90-day truce are uncertain. 
• Customers may apply Strategic Stockpiling During the Truce to leverage the 90-day pause to build buffer stocks of DRAM, CPUs, and other strategic components, anticipating potential tariff reinstatements or further disruptions after the truce ends.  

Product Updates

Integrated Circuits

Ongoing Shortages and Shifting Demand 

• Infineon’s SiC MOSFETs and high-voltage IGBTs see strong EV/industrial demand. Lead times pressured by AI/auto growth.
• Infineon’s BTT/BTS power IC lead times stable by mid-July, despite earlier worries.
• NXP i.MX8 series has been on the market for a while, aiming to gradually replace the original i.MX6 series, but due to price differences, the transition has not been smooth as expected. 

CPU

Availability Issues Across Vendors and Rising Costs 

• Intel Raptor Lake mobile CPU (10nm) severely short. Supply won't recover until late Q3 2025. Enterprise users anticipate allocation problems.
• Demand increased and LT unstable for Intel small core ATOM CPU. Tight supply due to capacity constraint.  
• AMD’s EPYC Turin and Genoa CPUs maintain strong momentum in AI and data centre deployments. However, availability remains tight, with demand exceeding forecasts. 
• Tight supply and unstable prices now affecting AMD Milan CPUs. OEMs predict higher contract costs by late Q2. 
• Qualcomm’s Snapdragon processors are seeing rapid adoption in AI-powered laptops and smartphones, with elevated demand coming from APAC manufacturers. 
• AMD embedded CPU pricing has increased by 15–20%, signalling tightening supply and higher demand from industrial customers.  
• Reports that Intel has reduced production of discontinued 12th-generation products and is also planning to discontinue 13th-generation products to encourage end customer to switch to 14th-generation products.

GPU

Shortages and the Rise of Alternatives in AI Inference 

• Current A6000 demand is high, but overall outlook is unclear as RTX 5880 Ada takes priority. Customers with projects already designed for A6000 are unlikely to switch.  
• High demand for AI chips is expected. NVIDIA’s enterprise-grade GPUs remain in short supply, with lead times ranging between 8–12 weeks.
  

Networking Cards

China Backlog Reduction 

• Surge in demand on Mellanox CX-7 NIC cards and LT stretch is observed with backlogs from major China OEMs. improving supply after July only. 
• Initial shipments of the Mellanox CX-8 series have been released to end customers for demand assessment. Notably, the Country of Origin (COO) for all models within both the CX-7 and CX-8 series will be exclusively non-China.

RDIMM

DDR5 Price Growth and the End of DDR4 Availability  

• SK Hynix and Samsung, are experiencing sustained demand for high-capacity RDIMM modules, particularly 96GB and 128GB DDR5-5600 and DDR5-6400 variants. 
• Manufacturers are proceeding with monthly price increases, with Tier 1 OEMs reporting double-digit quarter-on-quarter price increase for 128GB DDR5 RDIMMs. 
• Manufacturer’s DDR4 last-time-buy window ends in June, and procurement teams are rushing to secure inventory.  
• Lead times on DDR4 modules have narrowed to 10–14 weeks, but availability is expected to deteriorate as the cutoff date approaches. 
• The prices of DDR4 are expected to be significantly increased due to zero production (EOL) in the market.

SSD

Capacity Shift Causes Shortfalls in Entry-Level Drives  

• The SSD market is experiencing an aggressive production pivot as manufacturers prioritize high-capacity models for AI data centers and enterprise customers. 
• Samsung and Micron have officially scaled back manufacturing of lower-density SSDs (240GB–1TB), resulting in constrained availability for mainstream applications.
• NAND cost and production issues led Sandisk to raise prices by more than10%. Similar adjustments are expected for Consumer/prosumer SSD segments.

DRAM

Rising Prices and Capacity Crunch Across DDR5 Lines 

• The prices of LPDDR4 is expected to be significantly increased around 20%-30% and LPDDR5 increased around 15-20%. 
• SK Hynix has initiated monthly price increases, with OEM and EMS customers reporting Q2 cost hikes between 8% and 15%.

HDD

High-Capacity Demand Outpaces Production for Mid-Range Drives 

• High-capacity HDDs (20TB/24TB): Demand surge fueled by AI and hyperscalers. Buyers locking Q3 allocation, pressuring production and limiting smaller customer availability. 
• Mid-range HDDs (8TB-16TB): Growing shortfall as manufacturers prioritize high-capacity. Lead times (8TB/12TB) up to 10-12 weeks, Tier 2 customers reports delays of up to 6 weeks. 
• Entry-level HDDs (2TB-6TB): Slower delivery due to cloud-optimized model focus. Channel pricing firming across all capacities, especially enterprise SATA and select NAS. 

Passives 

• Vishay’s T55/T550 tantalum capacitors have exceeded 40-week lead times. Demand from automotive and defense sectors remains strong. 
• Kemet has announced a second wave of 10–15% price increases for B-case capacitors, with additional delays of 3–5 weeks across several voltage ratings. 
• Panasonic’s Chitose facility remains partially offline following the March fire, affecting production of NTC thermistors and chip inductors. Output is not expected to normalize until Q3.
  

Manufacturer News and Company Updates

• Nvidia and Other Chip Stocks Rally Following Temporary Tariff Pause: Shares of major U.S. semiconductor companies, including Nvidia, Intel, and Marvell Technology, rose sharply after the U.S. and China agreed to significantly reduce tariffs for 90 days while continuing trade negotiations.  
• TSMC Begins Production at U.S. Fab: TSMC officially began initial volume production of 4nm chips at its Arizona fab, marking a key milestone in U.S.-based semiconductor manufacturing expansion. 
  Onsemi Expands SiC Capacity:  Onsemi considers $2 billion investment in electric vehicle chip production to meet EV demand. 
• Samsung Shares HBM4 Roadmap: Samsung Reportedly in Talks with NVIDIA, Broadcom to Ship Custom HBM4 in 1H26.
  

Supply Chain Trends

• SMIC Faces Production Challenges Amid U.S. Restrictions: China's leading semiconductor manufacturer, SMIC, is experiencing significant production setbacks due to issues during equipment maintenance and the installation of new machinery.   
• U.S. Overhauls AI Chip Export Regulations Amid Industry Pushback: The U.S. government announced plans to revise restrictive export regulations on AI chips that were set to take effect on May 15. The revision aims to balance national security concerns with the need to support American innovation.  
• Malaysia's Semiconductor Industry Faces Tariff Uncertainty: Experts indicate that Malaysia's semiconductor industry, a significant global exporter, is experiencing pressure due to the uncertainty surrounding potential reimposition of tariffs by the United States and increasing regional competition. While a 90-day tariff suspension is in place, the long-term impact on investments remains a concern.

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