According to Nihon Keizai Shimbun's report on November 18, the performance of global semiconductor equipment manufacturers has hit bottom. The third quarter 2023 quarterly report showed that 8 out of 9 large companies in this field had higher net sales and profits than the second quarter, and it is expected that the fourth quarter will also continue to improve steadily.

According to reports, in the Japanese 17th time, the American Applied Materials Corporation (AMAT) released its performance report for the fourth quarter of fiscal year 2023 (August to October 2023), with sales of US $6.723 billion, a slight drop from the same period last year, But net income rose 26% to $2.04 billion. Among the 9 companies booked, Tokyo Electronics and 6 others maintained a strong performance in the third quarter of 2023 due to different sales destinations despite an annual drop in revenue and profit.

Most equipment manufacturing giants have lower profit levels, but there are still signs of recovery compared with the previous quarter. In the third quarter of 2023, 8 of 9 companies had sales and net income in excess of the previous quarter. Of the forecasts by companies and analysts themselves, sales by the eight companies in the fourth quarter will still be higher than in the previous quarter.

According to the French daily Echo on November 13, analysts predict that after several months of slowdown, the global semiconductor market appears to have reached its lowest point and is expected to rebound soon. All the hope of market recovery lies in artificial intelligence.

The report said that while macroeconomic uncertainty continues, the worst period for the semiconductor market appears to be over. Some signs indicate that the semiconductor market, which has experienced a general slowdown due to excess inventory, approached its lowest point and began to stabilize, even if it recovered.
Doug Oluckling, an analyst at industrial consulting firm Fabricated Knowledge, believes: "We may have already traveled low-lying areas, although different sectors may differ. This future recovery is also worth waiting for because of the cyclical "nature" of the industry, meaning it will decline after experiencing a boom stage."

During the epidemic, the semiconductor market experienced a climax. Under the domestic quarantine policy, companies and individuals are seeking to equip themselves with remote work equipment, which has led to an increase in demand for computers, smartphones, data centers and all related equipment components.
However, since 2022, this cycle began to enter a "negative" cycle, against the backdrop of the Russia-Ukraine conflict and the containment of inflation in consumer spending. Semiconductor companies have no choice but to delay investment and compress production capacity as much as possible to avoid accumulating too much inventory.

Glenn O'Donnell, vice president and chief research officer at consultancy Forrest, believes "the worst moment of market slowdown is behind us. The post pandemic dry-mouth era has intensified and businesses and consumers are beginning to upgrade their PCs and data centers."
One positive sign is that according to the latest statistics from the British professional company Omdia, revenue from the global semiconductor industry rose in the second quarter (3.8 percent to 124.3 billion dollars), marking a turning point after five consecutive quarters of decline. According to the agency's figures, Nvidia, as the recovering leader, accounts for more than half of quarterly revenue growth.

This American chip designer has been a huge success since the beginning of the year, mainly benefiting from the global popularity of generative artificial intelligence. Nvidia graphics processors can allow artificial intelligence to run in data centers. Glenn O'Donnell pointed out that the ChatGPT phenomenon has boosted Nvidia's business, and other companies like AMD, Intel and Qualcomm have also seized this opportunity. These chip makers have rolled out artificial intelligence chips, or chips that can allow AI to perform massive calculations.

Pat Gelsinger, CEO of Intel, said in his latest quarterly report that growth in data centers is not yet significant, but the sector has shown "signs of normalization." O'Donnell pointed out that cloud service providers like Google, Amazon and Microsoft have shown a greedy appetite for semiconductors, and they are also "developing their own chips" rather than relying solely on third-party companies.

Like smartphone chips, PC chips are beginning to see the end of the tunnel. There are two good signs in the industry: Qualcomm, which focuses on smartphone chips, has just released unexpected revenue and profit results; Intel, which has a monopoly on PC chips, has also announced better performance than the industry.
In addition, all the hopes of the chip industry are related to artificial intelligence. Pat Gelsinger stated that the arrival of PC artificial intelligence is a turning point in the PC industry.

Su Zifeng, CEO of AMD, one of the leading suppliers of graphics chips, predicts that the new generation of PCs will "completely redefine the computer experience in the coming years."