MARKET DYNAMICS:
- Q4 2019 is 17% above revenue forecast and reaches US$5,746 million: 11.3% of upside is due to volume upside and 9.1% due to ASP3 upside.
- The coronavirus outbreak impact of the epidemic will influence mostly on mobile and consumer CIS market with a drop in forecast on the global smartphone market expected on Q1 and Q2 2020.
- 2019 YoY revenue growth is higher than expected and reaches 25%, with a Q2Q growth at 38% in Q4 2019.
- CIS YoY growth should slow down to 7% in 2020 but this number will be aggravated by the outbreak of COVID-19.
- Long term growth should go below 10% within 5 years.
Y2020 NUMBERS: The best ever year for the CIS industry
This time reality exceeded Yole Développement (Yole) forecast quite significantly. Yole had predicted revenue of US$17.2b for 2020 and this prediction ended 11% below the confirmed numbers for the year. The extensive growth of CIS has brought this semiconductor specialty to revenues of US$19.3b in 2019, exceeding 4.6% of total semiconductor sales.
Reflecting on the year’s dynamics, Q1 and Q2 2019 had been underwhelming, both running 6% below expectation in a context of smartphone market saturation and trade war rhetoric. Q3 and Q4 totally reversed the gloomy trend of H1 2020, and the release of exciting smartphones with numerous cameras propelled the industry to overcapacity bringing US$5.7 billion per quarter to the ecosystem…
Q1 & Q2 2020: Short term forecast will be impacted by COVID-19
“What we cannot predict at Yole is the possibility of a systemic recession,” comments Pierre Cambou, Principal Analyst, Imaging at Yole. “People will still buy smartphones and smart speakers in 2021 so the risk is more a contamination coming from the financial sector than a biological threat,” he adds.
"from the financial sector than a biological threat” I think this time Pierre is underestimating the impact of the outbreak. McKinsey latest forecast for GDP drop is: China -3.3%, USA -8%, EU -9.5%, World -4.9%. The impact on CIS and semi in general will be much more hard than what reported here.
ReplyDeleteIt will be interesting to check this prediction i a few years time from now. I live in a COVID affected area where it is not allowed to leave your house unless you have good reasons. I am not allowed to leave my village. Police will stop you if you go for a jog and you pay quite a fine. A lot of people got unemployed in very short time. People start to worry how to pay the rent. And this has only started, it will take a while until herd immunity has built up. If this procerss has to be slowed in a way that the health system can handle the severe cases - this will take a lot of time. The life of a lot of people will be affecte A LOT (a lot more than anyone has ever experienced before), and this is a worldwide story. The life of billions of people is changing towards a more negative outlook where billions of people have to act more conservatively in terms of money. I honestly think that less people will consider buying the latest flagship smartphone again every year under such conditions.
ReplyDeleteI dont believe any prediction of this yole style at the moment. Radical changes are going on, it is impossible to predict CIS demand in 4 years from now. Covid will have a massive impcact on CIS production, on semiconductors in total and a most other industries. But I'm just a layman, many times a bit negative biased, hopefully Yole is right, because if I am right I also might lose my job in this interesting industry ;-)