The Chip Sector Has a New Sport: Finding the Bottom
With so much uncertainty, knowing when to make adjustments will shape semiconductor makers’ fortunes.
Who knows when demand will rebound.
Photographer: I-Hwa Cheng/BloombergBy late last year, it was clear the semiconductor sector was heading into a slump. Three years of runaway demand and tight output was coming to an end and companies right through the supply chain were suddenly caught with too much inventory as the global economy hit the brakes. Calling the bottom has been tough, and timing the rebound has multibillion-dollar repercussions.
Taiwan Semiconductor Manufacturing Co. back in January forecast first-quarter revenue that was below the figure analysts had expected, with Chief Executive Officer CC Wei saying that demand was “softer than we thought three months ago.” He went on to note that the world’s most valuable chipmaker expected “the semiconductor cycle to bottom sometime in first half 2023, and to see a healthy recovery in second half this year.”