Samsung and SK Hynix plan to buy fewer silicon wafers as chip profits slump
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Update time : 2023-01-19 10:12:04
South Korean chipmakers Samsung and SK Hynix are planning to purchase fewer silicon wafers for chip production than initially planned, according to TheElec.
The sources said the chipmakers discussed the issue with their respective wafer suppliers sometime in the fourth quarter. Silicon wafers are cut from crystalline silicon. The chips used in electronic products are cut from these wafers. There are five major suppliers of these wafers, including Shin-Etsu and Sumco from Japan, GlobalWafers from Taiwan, Siltronic from Germany and SK Siltron from Korea. During the worst two years of the epidemic, the supply of these wafers was tight and chipmakers were oversupplied. This situation continues in 2022 when the global recession begins. This is because silicon is a back-end industry and the impact of the consumer market comes later than the front-end industry, which sells products directly to customers and is more directly affected. In the third quarter of last year, when chipmakers first reported a decline in profits, wafer companies saw an increase in profits. Chipmakers are looking to reduce the number of wafers they purchase even more than usual. Sources said wafer supply deals are usually long-term, which usually limits chipmakers from adjusting their purchases, but Samsung and SK Hynix have asked for further reductions in supply.
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