THE GREENSHEET
The Greensheet: December 2019
IC
Infineon IR3 Series Issues Expected to Continue Through Q1 2020
Supply constraints persist for Infineon – specifically their IR35 and IR38 series. Recovery is not expected anytime soon as Infineon has been slow to release December shipments and has already pushed back year-end deliveries to February 2020. The company is announcing allocations, and only releasing small pockets of inventory — about 3,000 to 6,000 pieces per customer — at a time. Expedite requests remain unfulfilled and distributors have been instructed to no longer quote customers on IR35 and IR38 until further notice.
Customers using IR3897 have seen some relief in the last couple weeks as a large allocation already released remained uncollected. Aside from this, the shortage is considered critical with many customers, especially those in the server space, who have been seeking open market support.
Qualco Sony CMOS Sensor Shortages in Asia Continues
Sony customers continue to face supply issues on their CMOS Sensors. Distributors report that Sony failed to deliver on IMX 326, 226 and 274 commitments beginning in late November.
As we reported last month, supply has been unstable for some time, and we are starting to see prices increase – specifically on the high-runner IMX317 and IMX323 series that are widely used across multiple applications. The issues are still localized to Asia-based customers as the IMX series are not heavily used in other regions.
Son Yageo to acquire Kemet
Global MLCC Manufacturer, Yageo, announced its acquisition of Kemet in November. The acquisition allows Yageo to expand its portfolio, increase global scale and provide a one-stop solution for capacitor and connector demand. Combining their strengths, Yageo and Kemet look to enhance their presence in both high-growth (automotive, industrial, aerospace) and emerging markets (5G networking, communications and robotics).
The timing could not be better for Kemet as its revenue has declined substantially in the last fiscal quarter due to inventory issues post-2018’s capacitor shortage, which yielded concerns over pricing and profit margins.
PANASONIC Sells PSCS Division to Nuvoton
Panasonic has sold its sensors and microcontroller business, operated by Panasonic Semiconductor Solutions (PSCS), to Winbond subsidiary, Nuvoton, for $250 million. PSCS has struggled due to fierce competition from Korean and Taiwanese brands and the prolonged USA-China trade war. The sale is part of Panasonic’s 3-year transition to an asset-light company that includes reducing fixed costs, selling its less revenue-generating businesses, and ceasing production of LCD panels.
Panasonic’s Suzhou, China-based facility will serve as Nuvoton’s future base of operation when the company expands production capacity of 6 & 8-inch wafers. Nuvoton aims to enhance its market presence and competitiveness in 5G, power management and sensors markets.
MEMORY
Intel woes hurt memory market
Demand of memory DIMMs has dropped significantly in the recent months because of the CPU shortage. Manufacturers have been dealing with Intel’s poor supply and allocation, and even the open market is having trouble filling gaps. As a result, manufacturers are now waiting to monitor their CPU availability before buying memory and other accessories to complete their projects. SODIMMS and UDIMMs have been among the most affected.
2933 RDIMM still seeing some supply issues
Despite the overall drop in memory-market demand, the adoption of Cascade Lake CPUs has surprisingly resulted in an increase in demand on 2933 speed RDIMMs. Overall demand for 2933 RDIMMs has been higher than anticipated, leading to shortages on modules 16GB and up. It seems 16GB and 64GB are currently the most constrained due to production focusing on 32GB. Samsung, for example, has reportedly cut production on 16GB and is focusing on supply of the 32GB modules.
DRAM pricing still tumbling
DRAM prices are on a downtrend right now, due to slow demand and CPU and chipset shortages. Some manufacturers, such as Hynix, are expected to reduce their DRAM production in the next year as they struggle to level supply and demand. Samsung will most likely push to maintain margins and may reallocate some of their production toward the growing CMOS sensor demands.
We anticipate that DRAM pricing will continue to fall into Q1 and Q2 2020, despite the increased trading activity we’ve seen recently. By 2020, we may be seeing a rebound if inventory levels continue to decline.
CPU
Server CPU shortages are progressively worse
We are not seeing any signs of recovery in the server CPU segment, as both Purely and Cascade Lake remain extremely short. The main series that have been affected are the 61XX, 62XX, 42XX and 82XX. We have seen the most inquiries of the 4208s, which are virtually nowhere to be found, along with the 6230, 6240, and 6254s. With availability low and demand continuing to rise, prices are increasing significantly to the tune of 8-10%. Customers are hopeful we will start to see recovery soon, but there is a lot of doubt that relief will come until mid Q1 2020.
While we have seen improvement on Purely supply recently, Cascade Lake supply continues to worsen. Many suppliers and customers alike are seeing de-commits from Intel, which has made suppliers wary of taking any lead-time orders. We are hearing that Intel is sharing some capacity to focus on the Cascade Lake Refresh, which could be another driver of the recent shortages on Cascade Lake.
8Th and 9Th Gen Desktop supply remain short
The 8th Gen and 9th Gen market continues to be tight with the biggest problem parts being the i5-8500s and i5-9500s. As we predicted last month on the 8500s, pricing is starting to hover around the $230 range on the i5-8500s – an increase of nearly 12% – and has the potential to go even higher. In addition, we have seen similar pricing increases on the i5-9500 of around 10% since November.
We have started to see some relief on the i3-8100 and i3-9100s as supply seems more stable on these SKUs, with a fairly healthy backlog moving into the coming months. We have seen increased demand on desktop generally, as customers look to buffer stock before the holiday season and Chinese New Year.
Mobile supply relief is short lived
Although last month we started to see some relief in the market on mobiles, it was only for the short term. Premium pricing remains across all families, but that hasn’t shied customers away from consuming available stock at a rapid pace.
We are hearing that Comet Lake shortages are going to extend well into Q1 2020. One key driver is that Comet Lake continues to remain on the 14NM nodes, which most customers are staying on and causing the lack of overall available supply. Ice Lake supply has been short, but comparatively better than Comet Lake due to the fact that those are on 10NM nodes and customer transition has been fairly slow.
Whiskey Lake supply is expected to be tight moving into Q1. Suppliers are getting limited allocation from Intel. We have only seen limited offers on the i5-8265u, i5-8365u, i7-8565u. While pricing remains at a premium, offers are still moving fast when there is available stock in the market.
FINISHED GOODS
SSD shortages may extend throughout 2020
SSDs across all brands are still short, and many manufacturers haven’t seen enough supply in the last 2-3 months. All manufacturers are affected, with Intel being the most severe. While vendors have received full Intel SSD order confirmation, the company is delaying shipments. The miscommunication is causing vendors’ unwillingness to quote incoming stocks. We are hearing, though, there might be some supplies coming out by end of December.
For Samsung SSD, the most affected capacity is still the 240G. The price increased by 12% in November, and it is predicted to raise another 10-20% in December. As for capacities 480G & above, stock availabilities are healthy, but continue to rise from what we reported in the Greensheet last month.
Finally, Micron SSD lead time orders have stretched up to 12 weeks. Again, prices are expected to increase in the 10% range in December.
The shortage is expected to persist beyond Q1 2020.
Prices increasing & lead-times stretching for low capacity HDDs
There is a growing market shortage for 4TB, 6TB and 8TB HDDs. The causes are likely to be a combination of quality issues causing a recall, and ongoing geopolitical issues.
The geopolitical issues stem from Chinese companies that are blacklisted by the Trump Administration stocking up their inventory for back fill orders and upcoming projects before the January Chinese New Year.
In response to this and the recall, lead times have stretched up to 8-10 weeks from typical 4-6 weeks, and vendors are projecting pricing to increase around 3-5%.
RTX2080TI shortages continue
NVIDIA is dealing with Turing chipset shortages still that are affecting RTX2080TI supply. The company has shifted focus recently to focus on RTX6000/RTX8000, which is resulting in allocation on RTX2080TI graphic cards. Pricing is expected to remain elevated at 5-10% until Q1 2020.