In the second half of 2018, the growth of the semiconductor market began to weaken due to fluctuations in memory product prices, the mobile phone market and the virtual currency market. The trade friction between China and the United States in 2019 almost throughout the first half of the year. In the process of resolving this friction, not only the semiconductor industry in China and the United States was affected, but the semiconductor market in other countries was also shaken. Recently, trade cooperation between Japan and South Korea in the semiconductor market has begun to crack. Although 2019 is the 5G first year, 2019 is not the outbreak of the 5G application market. From the predictions of major authoritative research institutions, the semiconductor industry is not optimistic in 2019.
According to the latest update forecast of the IDC Semiconductor Application Forecast Report, global semiconductor revenue will decline to $440 billion in 2019 after three consecutive years of growth and a year-on-year growth rate of 13.2% in 2018, compared to 474 billion in 2018. The dollar has decreased by 7.2%.
At the same time, the World Semiconductor Trade Statistics Organization also expects semiconductor sales in all major markets worldwide to decline across the board in 2019. In addition, the organization also detailed semiconductor sales forecasts for various regions of the world. They believe that the US market may fall by 23.6%, the Japanese market may fall by 9.7%, and the Asia-Pacific market including China will fall by 9.6%. The European market may fall by 3.1%. However, the situation may improve next year. The World Semiconductor Trade Statistics Organization estimates that global semiconductor sales may increase by 5.4% in 2020.
Although market institutions think so, there are still some semiconductor companies doing a lot of moves this year. According to statistics, in the first half of 2019, a total of 18 mergers and acquisitions occurred, involving a total amount of about 35.8 billion US dollars. This includes Infineon's $10 billion acquisition of Cypress and Ziguang Guowei's completion of the 18 billion yuan acquisition of the French Linxens.
In the performance report released by some manufacturers, it also shows the actual situation of the semiconductor industry in 2019.
On March 21, Micron Technology announced its earnings report. The announcement shows that the company's 2019 financial year net profit attributable to ordinary shareholders was US$4.912 billion and operating income was US$13.748 billion. June Micron Technology released its third quarter earnings report for 2019. The report showed that Micron’s third-quarter revenue was $4.788 billion, compared with $7.797 billion in the same period last year. According to the above news, Micron achieved a total income of 18.536 billion U.S. dollars in the first three quarters of FY19. In the first three quarters of 2018, Micron's revenue reached $21.93 billion. In 2019, it was 15.5% lower than last year.
As we all know, Micron is a well-known memory product provider. And through its performance report in the first three quarters, it is not difficult to come to the conclusion that the memory market in 2019 is really not very prosperous. However, due to trade tensions between Japan and South Korea, the price of memory products has started to rise sharply. According to the Securities Times, in the context of the tight trade between Japan and South Korea, it is expected that Samsung and Hynix stocks will be available for only one or two months. In this context, in early July, Samsung took the lead in raising prices for factory customers. The categories involved in the price increase were DDR3, EMMC and Nand Flash. In particular, the recent price increase of Samsung 8GB and 16GBEMMC is relatively large, both of which are around 10%.
In addition, on June 14th, Broadcom also announced the company's financial report. The report shows that the company's 2019 financial year net profit attributable to ordinary shareholders was 1.162 billion US dollars, and operating income was 11.106 billion US dollars. At the same time, after Broadcom announced its second-quarter earnings report, it adjusted its expectations for 2019 revenue. Reuters reported that due to restrictions on business with Huawei Technologies Co., Ltd., Broadcom lowered its revenue forecast for FY 2019 by $2 billion. It is reported that the total sales of Broadcom and Huawei in 2018 is about 900 million US dollars.
At the same time, the company lowered its revenue forecast by Infineon. In March this year, the world's second largest automotive electronics market share Infineon issued a financial warning, the company's 2019 revenue growth target from the previous estimate of 9% Repaired to 5%, annual revenues of 8 billion euros, a reduction of 300 million euros compared to previous estimates.
In addition, according to foreign media reports, Texas Instruments also recently released the second quarter of 2019 financial report. The quarterly financial report showed that Texas Instruments' second-quarter net profit was $1.305 billion, down 7% year-on-year; revenue was $3.668 billion, down 9% year-on-year. Rafael Lizardi, chief financial officer of Texas Instruments, said that the company's orders were not affected by too many trade wars, and the decline in revenue was mainly due to the semiconductor industry's booming cycle. The current revenue announced by Texas Instruments has declined for three consecutive quarters.
In terms of EDA, Cadence's 2019 Q2 revenue was $580 million (guideline was 5.75~5.85), up 12% year-on-year and 0.6% quarter-on-quarter. At the same time, the company also released revenues in China: Q2 revenue in China was US$68 million, and the market share was 12%. The market share was significantly higher than the 8% of 2018Q2 and 10% of 2019Q1. . However, the company also said that it is subject to export restrictions on specific companies in China that began on May 16 and June 24. It is expected that the export restrictions will continue in the second half of the year, and revenue in China may decline.
In terms of foundry, on July 10, TSMC issued a notice stating that the company's consolidated revenue in June 2019 was approximately RMB 19 billion, an increase of 6.8% from the previous month and an increase of 21.9% from the same period last year. Accumulated revenue from January to June 2019 was approximately RMB 101.6 billion, a decrease of 4.5% from the same period last year. At the end of this month, TSMC will officially start trial production of the A13 processor used in Apple's next-generation iPhone, and they are still exclusive production. At the same time, Huawei's Kirin 980 upgraded processor will start trial production this month, which is also the only one Foundries.
From this point of view, in the first half of 2019, due to the cyclical fluctuations in the overall semiconductor market, as well as trade friction and other factors, the revenue performance of most international semiconductor manufacturers has been reduced to varying degrees, this is the authority The predictions remain consistent.
The semiconductor market environment in the first half of 2019 did cause some pressure on related companies. However, with the easing of Sino-US trade, this pressure may be eased in the second half of the year.