A decrease in silicon wafer shipments is attributed to an adjustment of inventories and lower utilization of integrated circuit fabrication following the release of Q1 results.

Over the last quarter, silicon wafer shipments have reportedly dropped 5.4% q-o-q to 2,834 million square inches (MSI), a 13.2% y-o-y drop from Q1 2023. The recent figures posted by SEMI have revealed that despite the expectation for wafer shipments to increase in 2024, shipments have continued to decline.

SEMI Silicon Manufacturers Group (SMG) noted that the decline is rather a function of the adjustment of inventories and lower than expected integrated circuit fab utilization which has led to the decline across all wafer sizes.

Demand for portable electronics is expected to return, especially with the newer generation of technology already ordered and in production, particularly the 3nm chip sizes from TSMC. However, the outlook for these advanced chips also remains questionable.

Following the recent earthquake that occurred on April 3^rd on the East Coast of Taiwan, TSMC noted that the company had sustained financial damages to operations, while equipment remained untouched. Specifically, due to the tectonic activity in the region, progress on in-production wafers had been lost, causing up to US$92.4Mn in damages for Q2 already. Should portable electronic demand recover, TSMC could potentially struggle to keep up with expected orders for their advanced chips.