October Purchasing Managers’ Indices Released
(Charts 1-9)
October PMIs have been released for major countries worldwide:
- Key regions saw a PMI improvement in October vs. September 2020 (chart 1)
- Global PMI reached its highest value since June 2018 (chart 2)
- Institute for Supply management’s U.S. PMI surged (chart 3)
- European PMIs improved, with the exception of UK and Russia (chart 4)
- Eurozone PMI reached its highest level since June 2018 (chart 5)
- Germany manufacturing activity continued to expand (chart 6)
- Asia improved with the exception of Vietnam (chart 7) as ASEAN composite PMI edged up but still remained below 50 (chart 8)
- China manufacturing activity continued to rise (chart 9)
Source: www.markiteconomics.com and www.ismworld.org
Q3 Global Semiconductor Sales Up 11% Over Q2
(Charts 10-17)
The Semiconductor Industry Association (SIA) announced worldwide sales of semiconductors totaled $113.6 billion during the third quarter of 2020, an increase of 11 percent over the previous quarter and 5.8 percent more than the third quarter of 2019.
Global sales for the month of September 2020 were $37.9 billion, an increase of 4.5 percent over last month’s total and 5.8 percent more than sales from September 2019.
“The global semiconductor industry posted solid sales in the third quarter of 2020, reflecting normal seasonal trends and increased demand for semiconductor-enabled products, but significant market uncertainty remains due to the pandemic and other macroeconomic factors,” said John Neuffer, SIA president and CEO.
“Sales into the Americas remained strong in September, increasing by more than 20 percent year-to-year, and sales increased on a month-to-month basis across all major regional markets,” Neuffer said.
Regionally, sales increased on a month-to-month basis in China (7.9 percent), Asia Pacific/Other (3.3 percent), Europe (3.3 percent), the Americas (2.2 percent), and Japan (1.5 percent).
On a year-to-year basis, sales increased in the Americas (20.1 percent), China (6.5 percent), and Asia Pacific/All Other (2.9 percent), but decreased in Japan (-1.8 percent) and Europe (-9.8 percent).
Source: www.semiconductors.org
U.S. September Electronic Supply Chain Shipments, Orders & Inventories
(Charts 18-29)
The U.S. Department of Commerce released its September “Factory Orders” report:
- Chart 18 summarizes the annualized (12/12) and 3-month (3/12) growth of the domestic electronic supply chain
- Electronic equipment book/bill dropped to near parity on a 3-month average basis (chart 19)
- Electronic equipment orders and shipments improved on both a 3/12 growth (chart 20) and dollar (chart 21) basis
- Electromedical, measurement and control equipment remains the major domestic end market (chart 22)
- Vehicle shipments have recovered from their early 2020 plunge (chart 23)
- Aircraft orders (chart 24) and shipments (chart 25) are still struggling
- Military electronics orders continued to drop in September (chart 26)
- Electromedical, measurement and control equipment orders and shipments continue to expand (chart 27)
- Communication equipment demand is increasing (chart 28) but computer orders and shipments have flattened (chart 29)
Source: www.census.gov
North American PCB Industry Sales Up 7% in September
(Charts 30-32)
IPC announced the September 2020 findings from its North American Printed Circuit Board (PCB) Statistical Program. The book-to-bill ratio stands at 0.93.
Total North American PCB shipments in September 2020 were up 7 percent compared to the same month last year. Compared to the preceding month, September shipments grew 21.3 percent.
PCB bookings in September grew 17.2 percent year-over-year and increased 59.1 percent from the previous month.
“Monthly PCB orders and shipments were up sharply in September, near their respective highs for the year. Some of the gains in September were likely the result of month-to-month variations that naturally exist in the PCB market,” said Shawn DuBravac, IPC’s chief economist.
“Orders and shipments continue to cool following a large jump in the immediate aftermath of the pandemic. Shipments over the last three months are just below the prior three months, while bookings are off 16.7 percent,” DuBravac said.
Note: The December 2019 ratios have been revised since their original publication due to updated data.
Source: www.ipc.org
Global EMS/ODM sales up 6.7% in Q3
(Chart 33)
Composite revenues of 52 publicly traded global EMS and ODM companies were up 6.7 percent in Q3 2020 versus Q3 2019, based on a mixture of actual and estimated company financial reports.
Source: Company financial reports analyzed by Custer Consulting Group
Digitimes Research: Global Server Shipments Down 6% On Quarter in Q3
According to Digitimes Research, global server shipments are estimated to have fallen 6 percent sequentially in Q3 2020, after reaching the year’s peak in the second quarter, as demand began to weaken. According to Digitimes Research’s Server Tracker, demand is expected to fall further in the fourth quarter.
The shipment declines were a result of several factors, according to Digitimes Research – including “the high comparison base formed in the second quarter amid clients’ earlier-than-scheduled inventory build-up; the lingering coronavirus pandemic; and delayed releases of Intel’s next-generation server CPUs, which caused cloud datacenter operators and server brand vendors to slow down their order pull-ins in the second half of 2020.”
According to the report, global server shipments had seen a nearly 20 percent on-year growth in the first half of 2020. While on-year shipment growth in the 2H 2020 will not be as strong as that in the first, full-year 2020 shipments will still grow annually.
U.S.-based cloud datacenter operators and global first-tier server brands, including Microsoft, Google, Facebook, Dell, HPE, Lenovo and Supermicro, will still focus on digesting inventory in the fourth quarter, Digitimes Research believes. Server brands are also facing enterprise clients cutting their server procurement due to the pandemic’s impact.
Amazon will be the only first-tier cloud datacenter operator to see server shipment growth in the fourth quarter as the company has expanded hardware infrastructure for its e-commerce platform to cater to year-end shopping demand in addition to cloud computing services.
In 2021, as the pandemic will continue to undermine the global economy, enterprises are likely to further reduce their capex. The U.S.-China trade tensions may also decelerate Chinese server brands’ shipment momentum in 2021.
However, as Intel’s and AMD’s new-generation server CPUs will become widely available in the first half of 2021, a wave of server replacement trend in the enterprise market is to be expected. In addition to rising demand for cloud services from U.S. and Chinese providers, global server shipments are expected to continue growing in 2021.
Source: www.digitimes.com
As COVID-19 Continues, Optoelectronics, Sensors/Actuators and Discretes Sales Stabilize
(Chart 34)
IC Insights reports that, eight months after the COVID-19 virus pandemic accelerated around the world, sales of optoelectronics, sensors and actuators, and discrete semiconductors have stabilized. In some cases, revenues have begun showing signs of a slight recovery in the second half of 2020.
A new update of IC Insights’ forecast for optoelectronics, sensors/actuators, and discretes (O-S-D) shows combined sales in these three semiconductor market segments falling 4.4 percent in 2020 to $82.3 billion versus the projection of a 6.1 percent drop in the 2020 edition of the “O-S-D Report,” released in April).
The updated forecast also shows a modest 7.7 percent rebound in 2021, which will lift total O-S-D sales in the three markets to a new record high of $88.6 billion. The last time O-S-D sales fell was in 2009, when revenues dropped 10.0 percent during a semiconductor downturn that occurred in the last major global economic recession, caused by the 2008 financial crisis.
IC Insights expects the strength of the 2021 O-S-D rebound will be held in check by ongoing concerns about health threats from the coronavirus until new vaccines are developed, fully tested, and available worldwide.
The updated O-S-D forecast shows only three of the 20 main product categories in optoelectronics, sensors/actuators, and discretes achieving sales growth in 2020 – forecast to rise 6 percent for laser transmitters, 0.5 percent for total image sensors (which will be driven by 0.9 percent growth in CMOS image sensors) and 1.4 percent for actuators.
No discretes product categories are expected to register sales increases in 2020. Growth in laser transmitters, total image sensors (including CMOS designs) and actuators is expected to lift these product categories to new record-high sales in 2020.
In 2021, a sales rebound is forecast to occur in all 20 main O-S-D product categories, with seven of them reaching record-high revenues next year.
Source: www.icinsights.com
Global Tablet Shipments Up 10.5% Sequentially, 0.4% on year in Q3
Third-quarter 2020 global tablet shipments rose 10.5 percent sequentially and 0.4 percent on year to 43.83 million units, with non-Apple vendors maintaining strong shipment momentum in the peak season with friendly pricing, Digitimes Research reports.
The reports also states that global tablet shipments are expected to increase 7.3 percent sequentially to a 13-quarter high in the fourth quarter of 2020, with significant increases in orders from Southeast Asia, India and Latin America for education applications.
According to Digitimes Research, the world’s top five tablet vendors by shipments remained unchanged in the third quarter, with Apple taking the lead followed by Samsung, Huawei, Amazon and Lenovo. Lenovo is expected to outstrip Huawei and Amazon to become the number-three brand by strengthening shipment momentum in the fourth quarter.
The shipment ratio for the 10-inch and above segment fell under 80 percent in the third quarter due to massive shipments of 7- and 8-inch models by Amazon and Lenovo. The ratio for 10x-inch tablets is expected to decline to below 65 percent in the fourth quarter as a result of shipments of new offerings sized 8x-inch and 11x-inch and above by Samsung and Microsoft, Digitimes Research predicts.
Among ODMs in Taiwan, Compal Electronics delivered over 40 percent of tablet shipments in the third quarter, thanks to its return to the supply chain of iPad Air 4. Foxconn’s corresponding ratio declined slightly in the quarter, but still stayed at over 50 percent.
According to the report, Foxconn’s shipment ratio is expected to fall under 50 percent in the fourth quarter due to a decrease in shipments of iPad Air 3 model, while Pegatron and Quanta Computer will see their ratios pick up on increasing shipments of new Microsoft Surface devices.
Source: www.digitimes.com
Worldwide Silicon Wafer Area Shipments Up 6.9% in Q3
(Chart 35)
Worldwide silicon wafer area shipments contracted 0.5 percent to 3,135 million square inches in the third quarter of 2020 compared to the second quarter of the year, but registered a 6.9 percent increase from the 2,932 million square inches shipped one year ago during the same quarter, according to the SEMI Silicon Manufacturers Group (SMG) in its quarterly analysis of the silicon wafer industry.
“After a strong rebound in the first half of 2020, global silicon wafer shipments in the third quarter were flat to the previous quarter,” said Neil Weaver, chairman of SEMI SMG and vice president of product development and applications engineering at Shin Etsu Handotai America.
Source: www.semi.org
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