Weekly News 046

Contents:

1. Omdia: Semiconductor industry soars 8.4% to $139 billion in 3Q23, fueled by AI demand.

2. Microsoft Invests $500M to Expand its Hyperscale Cloud Computing & AI infra in Quebec.

3. ADI: Q4 revenue fell 16% year-on-year due to high inventories.

4. LG's LCD TV display shipments to grow 50% to 12 million next year.

5. UCL and Hyundai Motor Company to collaborate on carbon-free technologies.

1. Omdia: Semiconductor industry soars 8.4% to $139 billion in 3Q23, fueled by AI demand.

Led by continued demand for AI, the total semiconductor industry increased by 8.4% in 3Q23 from the previous quarter, but declined by 4.7% from a year earlier, hitting $139bn in terms of Omdia’s latest Competitive Landscape Tracker. The industry has now grown for a second straight quarter, after previously dropping for five consecutive quarters. 

Intel topped the list with revenue of $13.3 billion for the third quarter of 2023, up 8.6% over the preceding quarter, and down 10.3% on a year ago. NVIDIA, which makes GPUs that are used for data-intensive AI, increased semiconductor revenue by 18% to $12bn, soaring by 157.8% year on year. Samsung earned revenue of more than $10.7 billion, a sequential growth of 8.8%, falling by 26.4% compared to last year.

Comment: 

The rise of AI has significantly improved revenues for firms with a large presence in this area. At this time, the fiercer competition between Intel, NVIDIA, and Samsung is going to stimulate the innovation and advancement of semiconductor technologies.

2. Microsoft Invests $500M to Expand its Hyperscale Cloud Computing & AI infra in Quebec.

Microsoft announced an investment of $500 million in expanding its hyperscale cloud computing and AI infrastructure in Quebec over the next two years. This investment will also increase the size of Microsoft’s local cloud infrastructure footprint by 750% across Canada. 

Microsoft anticipated expanding its computing capacity by approximately 240% over the next three years through this investment and accelerating the pace of AI innovation.

Nowadays, the company operates 20 data centers in Australia, and it plans to build nine more with this investment, bringing the total number of data centers to 29.

Comment:

Investors are flocking to generative AI chatbot companies following AI infrastructure and cloud computing. Microsoft's 29 data centers in Australia have boosted its computing power by a whopping 250%.

3. ADI: Q4 revenue fell 16% year-on-year due to high inventories. 

Analog Devices (ADI) said in its recently released fourth-quarter report that its revenue fell 16% year-on-year to $2.72 billion due to high inventory, but was slightly higher than the $2.7 billion expected by a FactSet survey. 

According to ADI's report, only automotive chip revenue grew positively in the fourth quarter, up 14% year-on-year to US$730 million, with automotive accounting for 27% of overall revenue. Industrial revenue accounts for about 50% and is the largest source of revenue. However, revenue in the fourth quarter fell 20% year-on-year to US$1.35 billion.

Comment:

Looking at the full year of fiscal 2023, ADI's revenue was US$12.3 billion, an increase of 2% from the previous year, driven by new records in the industrial and automotive fields. However, demand for industrial semiconductors is weak, and almost all applications have seen declines. Only the defense and aerospace industry still maintains a certain demand.

4. LG's LCD TV display shipments to grow 50% to 12 million next year.

Omdia reported on Wednesday, that LG Display is expected to deliver 12 million to 13 million liquid crystal (LCD) TV displays in 2024, of which there are 9 million displays shipped to Samsung Electronics and LG Electronics. Deliveries to Samsung Electronics are set to whop ones to LG Electronics. Next year's shipments of LG’s LCD TV displays will be 1.5 times as many as this year's shipments of 8 million pieces. 

In addition, LG Display's large W-OLED TV display shipments are estimated to increase from 4.7 million this year to 5.7 million next year, while Samsung Display's large quantum dot (QD)-OLED TV panel shipments are forecast to go up from 1 million this year to 1.5 million next year.

Comment: 

LG’s LCDs are only produced at the plant in Guangzhou, China. Samsung Electronics and LG Electronics have asked LG Display to expand its LCD TV display production to reduce its dependence on Chinese display makers.

It is reported that Chinese TV display manufacturers secured around 85% of LCD TV display market share at LG Electronics, and roughly 55% at Samsung.

5. UCL and Hyundai Motor Company to collaborate on carbon-free technologies. 

Announcing the partnership to research carbon-neutral future technologies, Hyundai Motor and University College London (UCL) signed a memorandum of understanding (MOU) on ‘Cooperation in areas of Research and Development for Hydrogen Production, Hydrogen Fuel Cells, and Electrification Technology’.

With both South Korea and the UK aiming to achieve carbon neutrality by 2050, Hyundai Motor looks to accelerate the development of a hydrogen economy and realize a sustainable future mobility ecosystem through this MOU.

Comment:

Hyundai, which is vigorously advancing electric and hydrogen fuel cell vehicles, has made significant progress in exporting its electric cars and hydrogen fuel cell heavy trucks.