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TSMC warns over deepening slump in chipmaking sector

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Re: TSMC warns over deepening slump in chipmaking sector

#71

Post by kevin_thibedeau »

cs702 wrote: post #17

TSMC just warned the world of a 10% decline in chip revenues. Given that chips today are critical component of every phone, TV, laptop, desktop PC, server, vehicle, dishwasher, and pretty much everything else , TSMC's warning suggests we're going to experience a significant global economic contraction soon. Hopefully I'm wrong.

Most consumer electronics don't need ICs built on cutting edge process nodes. Most of the global population of humans have more pressing needs than acquiring the latest gewgaws that can upstage last years models.

Re: TSMC warns over deepening slump in chipmaking sector

#72

Post by nyokodo »

cjrp wrote: post #33
jrockway wrote: post #22

Earlier quoted context omitted.

I don't think that's true. If my BOM costs go down by 10%, I don't need to charge any less money for my product. If Apple could build an iPhone for 1 cent, why wouldn't they still charge $1000 for it? They can say it's how much iOS costs or whatever. (And hey, use the extra profit to hire more tax-paying iOS developers, making iOS even more valuable.)

I think the point is why has revenue dropped 10% for TSMC if everything downstream is going gangbusters? Doesn't it point to a drop in demand for chips, and therefore the retail devices they go inside?

> Doesn't it point to a drop in demand for chips

Yes, but in isolation it isn't evidence of an economic downturn in general. It is evidence of the whiplash of consumer demand shifting during COVID from services to goods and back again along with the cost of retooling the industrial plant to match that demand. There's a range of ripple effects across industries that will be ongoing for some time.

Re: TSMC warns over deepening slump in chipmaking sector

#73

Post by HeyLaughingBoy »

mschuster91 wrote: post #56
ajross wrote: post #43

Earlier quoted context omitted.

> Given that [...] we're going to experience a significant global economic contraction soon. What's with all the doomslinging in modern discourse? No, no, that's not now it works at all. There was a chip shortage just a year ago! Did that plunge us into recession? No, clearly it didn't. Then it was Inflation that was going to kill us all. And it didn't either. Now all of a sudden we're swinging the other way with chi…

> What's with all the doomslinging in modern discourse? Because public trust in the ability of governments to manage a crisis has gone completely fucking downhill, worldwide: - the US couldn't even manage to beat a gang of cave-living Islamist terrorists using kalashnikovs in 20 years, and had to flee the country in shame - we went through three years of a worldwide pandemic, then panicked governments acted like it w…

This is probably the most depressing comment that I've ever upvoted.

Re: TSMC warns over deepening slump in chipmaking sector

#74

Post by tylerfontaine »

adventured wrote: post #53
silisili wrote: post #26

Earlier quoted context omitted.

I have an ADATA 2TB in a PS5 and my work machine. These aren't fly by nights. They can be had for sub $100. Even the much lauded Samsung 980 Pro is dipping close enough to the same.

Assembling a new home PC, picked up a 2tb Samsung 980 Pro with a heatsink recently for $129 (I think it was $113 without the heatsink at that moment). DDR5 ram is finally starting to get price reasonable as well.

I got a 2TB 980 pro with heat sink from Bestbuy last week for $99. I was astounded. No brainer upgrade for the PS5

Re: TSMC warns over deepening slump in chipmaking sector

#75

Post by pdonis »

adventured wrote: post #48
memen wrote: post #36

Earlier quoted context omitted.

> If Apple could build an iPhone for 1 cent, why wouldn't they still charge $1000 for it? Cause in healthy capitalism, a competitor could step in and sell it for $999 and Apple would lose market share quickly.

> Cause in healthy capitalism, a competitor could step in and sell it for $999 and Apple would lose market share quickly. No they can't. You're neglecting the various moats that an entity like Apple enjoys with the iPhone. First you have to be able to actually build a similar or superior product. You can't do it. Elite of elite tech engineering companies like Samsung can just barely keep up generation after generatio…

> You're neglecting the various moats that an entity like Apple enjoys with the iPhone.

A world in which Apple could build iPhones for 1 cent would be a world in which those moats did not exist.

Re: TSMC warns over deepening slump in chipmaking sector

#76

Post by bbatsell »

cs702 wrote: post #68
ajb wrote: post #19

Earlier quoted context omitted.

This isn't necessarily representative of the economics of downstream sectors, because it's probably caused by the Bullwhip Effect[1] like the recent semiconductor shortage. "The bullwhip effect refers to a scenario in which small changes in demand at the retail end of the supply chain become amplified when moving up the supply chain from the retail end to the manufacturing end." [1] https://www.investopedia.com/bullw…

I certainly hope you're right. Keep in mind: TSMC is entrenched in a lot of markets characterized by short lead times (say, < 1 month), and a 10% drop is a lot more than anyone -- including the company -- was expecting. Sometime ago I recall seeing charts showing that changes in TSMC's annual revenues are highly correlated with measures of global economic activity such as changes in Apple's global revenues and change…

Could you elaborate on what you’re referring to? I’m certainly not an expert, but my understanding was that the vast, vast majority of TSMC’s revenue comes from production of completely custom wafers on newer nodes, and I’m hard pressed to think of something in the industry with _longer_ lead times.

Re: TSMC warns over deepening slump in chipmaking sector

#77

Post by daniel-cussen »

cs702 wrote: post #17

TSMC just warned the world of a 10% decline in chip revenues. Given that chips today are critical component of every phone, TV, laptop, desktop PC, server, vehicle, dishwasher, and pretty much everything else , TSMC's warning suggests we're going to experience a significant global economic contraction soon. Hopefully I'm wrong.

[flagged]

Re: TSMC warns over deepening slump in chipmaking sector

#78

Post by hdjjhhvvhga »

mschuster91 wrote: post #60
dragontamer wrote: post #2

This boom/bust is really obvious with regards to computer prices. I'm seeing 2TB NVMe PCIe 4.0 SSDs with 7000+ MBps under $100 these days. Almost everything in the computer-world is on a significant sale.

Meanwhile, Apple charges hundreds of dollars at purchase time for 256GB more storage. And it's non-upgradable on top of that.

Sometimes I feel they are just testing our limits. Same with iPhone price increases. I guess they are going to continue until the net profits decrease.

Re: TSMC warns over deepening slump in chipmaking sector

#79

Post by tim333 »

cs702 wrote: post #17

TSMC just warned the world of a 10% decline in chip revenues. Given that chips today are critical component of every phone, TV, laptop, desktop PC, server, vehicle, dishwasher, and pretty much everything else , TSMC's warning suggests we're going to experience a significant global economic contraction soon. Hopefully I'm wrong.

10% decline over the previous year, which was a boom year due to shortages after covid.

See this article back from distant Jan 23 for example

"Timeline: causes of the global semiconductor shortage" https://supplychaindigital.com/top10/timeline-causes-of-the-...

Re: TSMC warns over deepening slump in chipmaking sector

#80

Post by HDThoreaun »

bradleyjg wrote: post #12
christkv wrote: post #7

Good hopefully the prices will slide back towards pre pandemic levels making it more affordable for people

Houses too …

This countries middle class will turn into single issue voters if housing prices ever go down. Politicians are too scared of them to let it happen.
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