The Greensheet: March 2025

The Greensheet is Fusion Worldwide’s periodic market intelligence report highlighting critical developments across the electronic component supply chain. The March edition covers updated trends across eight major product categories and features insights into key players such as Intel, AMD, Infineon, and STMicroelectronics. It also provides a snapshot of CY24Q4 earnings season takeaways, including inventory digestion trends and 2025 demand outlooks, alongside broader commentary on global supply chain shifts, pricing changes, and AI-driven market dynamics.

Product Updates

Integrated Circuits

Shifting Market Trends 

• Demand for NXP’s MPC8 family continues to rise, particularly in networking applications, despite broader market fluctuations. 
• Infineon's high-voltage Cool Mosfet and IGBT product lines remain in high demand, with increasing lead times anticipated into Q2 2025. 
• Texas Instrument TCAN series is expanding production capacity due to increasing global demand, but supply and demand issues continue due to delays in capacity expansion. 
• Sony CMOS sensors are facing consistent production shortages. Standard lead time is about 6 months, and the supply is subject to the allocation. 
• ST Micro inventory for MCUs and MEMS sensors is critically low. The manufacturer is refusing special pricing and seeking higher margins, with lead times now at 12-18 weeks. 
• SanDisk eMMC is facing supply constraints and price increases due to demand exceeding production capacity. A general price increase of at least 10% is expected starting April 1st, with further quarterly reviews anticipated.

Networking Cards

High Demand and Supply Constraints 

• Mellanox’s MCX7 series networking cards face critical shortages, with Nvidia prioritizing key clients, leading to extended lead times and limited availability. 
• Broadcom’s HBA cards now have lead times of up to 42 weeks due to rising demand from China’s internet companies, driving price increases. 
• Intel’s E810 Ethernet Adapter is reaching EOL in March 2025, with last-time buys recommended to secure remaining stock. 
• Intel X710 network card is experiencing a supply shortage, as the majority of the supply has been reserved by Chinese Manufacturer.

 CPU

Market Adjustments and Demand Fluctuations 

• Intel is experiencing decreased demand for its server CPUs, leading to difficulties in obtaining approved special pricing and unstable allocation, particularly for 3rd Gen Ice Lake processors. A number of customers have reported Intel has been aggressive with offering pricing discounts and offering front-end discounts in lieu of back-end rebates which marks a significant departure in pricing strategy and speaks to concerted efforts to preserve share.   
• Demand for AMD’s EPYC Turin server CPUs continues to rise, with customers reporting increased project ramp-ups. However, supply remains tight, and allocations are challenging to secure.   
• AMD’s 3rd Gen Milan and 4th Gen Genoa server CPUs are seeing steady demand, particularly in enterprise computing and AI workloads. 
• Supply for Intel’s 13th Gen Raptor Lake mobile CPUs remains constrained, with customers facing difficulties in securing allocations. Intel has indicated that recovery may not occur until June. 
• Slow consumer demand for gaming laptops is leading to excess inventory in gaming-specific mobile CPU stock, forcing suppliers to adjust pricing. 
• Intel and AMD are preparing for a new refresh cycle in desktop CPUs, with AI acceleration capabilities expected to drive demand. 
• Intel J4125 has been announced as End of Life (EOL), and its market supply is limited. 
• Intel's Panther Lake, its upcoming mobile CPU for AI PCs, is expected to enter volume production in the second half of 2025, according to recent updates.

GPU

Pricing Volatility and Market Demand 

• NVIDIA is focusing its Blackwell GPU shipments toward strategic customers, leading to constrained availability for the broader market. 
• AMD’s 7900XTX continues to outperform in AI model processing, increasing adoption in data centers seeking cost-effective alternatives to NVIDIA offerings. 
• GeForce RTX 4090 24GB is experiencing high demand, with customers reporting significant needs needed for server applications.  
• NVIDIA is prioritizing Blackwell GPU shipments for key clients, resulting in constrained availability for others. Lead times for new orders are estimated at 4-5 months. 
• NVIDIA’s latest consumer Blackwell GPUs face defect controversies, leading to increased inquiries for older GPUs like the 40xx series.

Motherboards

Supermicro Adjusts Strategy 

• Supermicro's strategic move to focus on integrated server solutions over standalone motherboards is driving increased customer adoption of its X11 and X13 series.

RDIMM

Market Trends and Shifting Preferences 

• Growing AI investments are driving increased demand for high-speed, high-capacity RDIMM modules, particularly 64GB DDR5-5600. 
• Interest in 4800-speed modules is declining, with EOL notices issued. Meanwhile, demand for high-capacity 96GB and 128GB modules continues to grow due to upside or reduce forecast. 
• Pricing forecasts for the RDIMM market are shifting, with increasing noise around the possibility of pricing increasing in the second half of the year, contrary to previous expectation of a flat-to-slightly down market that was widely held at the beginning of the calendar year.

SSD

Soft Market Conditions Persist 

• Increased procurement of High density SSDs from large CSP's, and the growth of AI development, has caused SSD manufacturers to shift their production focus. This shift has created supply deficits in lower density SSD's, namely the 240GB, 480GB, and 960GB sizes 
• Major SSD manufacturers continue to cut production in response to weak demand, with price reductions of around 5% projected for Q2 2025. 
• WD and SanDisk have officially separated since February 1st, with SanDisk focusing on SSD business and WD on HDDs. WD faced system issues causing shipment delays, but these are expected to be resolved soon. 

HDD

AI Adoption Fuels Market Shifts 

• The shift towards larger 18TB+ HDD models is causing shortages in 16TB drives, impacting buyers seeking mid-range storage solutions. 
• Hard drive manufacturers are increasing capacities to meet AI-driven demand, with new models launching in 2025. Lead times for smaller-capacity drives (2-8TB) have already increased significantly. 

Passives

Extended Lead Times Continue 

• Vishay’s T55 and T550 series tantalum capacitors now have lead times exceeding 36 weeks, reflecting increased demand from industrial and automotive applications. 
• Kemet’s polymer tantalum capacitors are experiencing lead times of 36-40 weeks due to high demand.

Automotive ICs

Supply Challenges and Market Shifts 

• Panansonic Industry Fire at Chitose Factory on March 9th affecting Chip Varistors, NTC Thermistors and Chip Inductors.  
• Texas Instruments (TI) is expanding TCAN series production, but delays are causing supply constraints and longer lead times. 
• BYD’s EV production surge is increasing demand for automotive ICs, leading to allocation challenges as suppliers prioritize high-volume clients. 
• TE Connectivity will implement another price increase for automotive and industrial connectors in April 2025 due to rising material costs and strong demand. 

Manufacturer News and Company Updates

• BYD’s February shipments surged 161% year-over-year, setting a new production record and signaling continued strength in the electric vehicle sector. 
• Foxconn reportedly lands exclusive AI server orders for US Stargate AI project 
• Intel is redirecting resources toward AI processor development to counteract slowing demand in traditional server and consumer CPU markets. 
• Microchip announces layoffs due to falling automotive demand, plans to cut 2000 jobs, restructure operations, and sell integrated circuits to a Chinese partner.  
• Onsemi has bid to acquire chip developer Allegro MicroSystems for $6.9 billion. The acquisition could help give Onsemi new sources of revenue as it navigates a market downturn 
• WPG Holdings has seen a marked surge in demand for AI servers in the Chinese market in recent months. This upswing has invigorated procurement activities across the supply chain delivering a tangible boost to the company's operations. 

Supply Chain Trends

• Tariffs threaten to disrupt North American supply chains by creating border bottlenecks, driving up logistics costs, and extending delivery times.  
• Automotive manufacturers globally are prioritizing supply chain resilience by building safety stock for vital components. In Europe, this is further emphasized by a growing trend towards nearshoring and localized battery production, driven by cost reduction and sustainability objectives 
• India is attracting significant semiconductor investment, with Micron and Foxconn expanding local manufacturing. Additionally, Amazon's cloud division plans to invest $8.2 billion in an Indian state. 

CY24Q4 Earnings Season

Inventory Digestion

With earnings season for CY24Q4 having come to a close, we take a look at what OCMs and distributors have to say on the topic of inventory digestion, a major factor facing the semiconductor industry over the past 18 months. The following information has been gleaned from respective company’s earnings call transcripts. All told, it appears that inventory build up remains a headwind for the industry as a whole even if the cycle of digestion appears to be closer to normalization.

Companies Reporting Improving Inventory Digestion 

These companies noted that inventory digestion is progressing, with demand stabilizing and inventory levels returning to normal. 

• TSMC acknowledged that while inventory digestion was a challenge throughout 2024, conditions are beginning to improve, particularly in automotive and high-performance computing (HPC). 
• Infineon reported signs of improvement in inventory normalization among distributors, though some areas still require further reductions. The company remains optimistic that inventory adjustments will largely be completed by mid-2025. 
• Lattice indicated that inventory normalization is well underway, with channel inventories improving steadily. The company expects a return to mid-range inventory levels by mid-2025. "Ongoing inventory normalization continues, with a return to mid-range inventory levels expected by mid-2025." 
• Skyworks noted that internal inventory levels have been declining for eight consecutive quarters, a positive trend that suggests gradual improvement. However, some segments are still affected by lingering excess inventory at the customer level. 

Companies Reporting Worsening Inventory Digestion 

These companies indicated that inventory challenges remain a major issue and, in some cases, are worsening due to slow demand recovery, prolonged destocking, or excess stock at Tier 1 suppliers. 

• STMicro reported severe inventory corrections across both distribution and OEM channels, leading to excess stock equivalent to one to two months above normal levels.
• ON Semi is facing increasing inventory pressures, with manufacturing utilization declining to 59% in Q4 2024 and projected to drop further in Q1 2025.  
• Microchip continues to struggle with high inventory levels, particularly in direct customer inventory, which is a bigger issue than distribution inventory. 
• Vishay faced challenges due to excess automotive and industrial inventory, particularly in Europe, which is causing sluggish demand and delayed order replenishments. 
• Diodes reported continued inventory digestion across multiple regions, especially in Europe, where demand remains weak, and extended shutdowns have led to excess inventory buildup. 
• Renesas faced rising in-house inventory levels, with slower-than-expected reductions in work-in-progress inventory. 
  Coherent reported inventory corrections in its materials segment, particularly due to weak automotive demand. 
• Western Digital saw significant inventory issues in the NAND market, with oversupply leading to pricing pressures and lower margins.

Companies Reporting a Neutral or Cautious Inventory Outlook 

These companies indicated that inventory challenges persist but are not worsening. They expect gradual improvements but remain cautious about demand fluctuations. 

• TE Connectivity reported inventory normalization issues in medical equipment, though a gradual improvement is expected later in 2025. 
• NXP remains cautious about inventory levels at Tier 1 automotive customers, with limited visibility into how quickly excess inventory will clear. 
• Arrow reported slow-moving inventory digestion, particularly in the mass-market segment, with limited visibility on full recovery. 
• Allegro sees mixed signals in inventory levels, with higher orders in some areas but lingering excess stock in others. 
• MPS noted inventory digestion issues from prior overstocking, though distributor inventory levels are improving.
  

Forecast for 2025

Likewise, we look to OCM and distributor reports on earnings for clues as to how 2025 will play out. The following information has been gleaned from respective company’s earnings call transcripts.

Optimistic Outlook for 2025

These companies have a positive outlook for 2025, citing strong demand drivers, recovery trends, and growth opportunities.

• TSMC is highly optimistic about 2025, projecting mid-20% year-over-year revenue growth, primarily driven by AI and high-performance computing (HPC). It expects a moderate recovery in general semiconductor demand, with automotive, smartphone, and industrial applications improving alongside.
• Amphenol remains confident in AI, defense, and industrial markets, expecting continued growth in 2025. The company anticipates a strong data center demand cycle, incremental recovery in industrial markets, and growth in high-speed interconnects for AI applications.
• Qualcomm foresees strong demand for premium smartphones, automotive, and AI-powered PCs, driven by its Snapdragon platform. The company expects record chipset revenues and increased adoption of AI inference solutions.
• Infineon has an optimistic 2025 outlook, expecting AI-related revenue to exceed €1 billion within two years. It anticipates continued automotive growth, especially in China, with strong traction in silicon carbide and power electronics.
• AMD projects double-digit revenue growth in 2025, fueled by strong data center, AI, and client computing growth. It sees continued strength in AI GPUs and enterprise AI deployments.
• MPS is bullish on 2025, expecting growth in automotive, communications, and enterprise notebooks, along with improved inventory levels across channels.

Pessimistic Outlook for 2025

These companies expressed significant concerns about market conditions, citing weak demand, inventory issues, and macroeconomic uncertainties. 

• STMicro expects weakness in industrial and automotive markets to persist, particularly in Europe, due to inventory corrections and lower demand for microcontrollers.
• ON Semi forecasts a 25% sequential decline in automotive demand in Q1 2025, with factory shutdowns in China affecting orders.
• Microchip remains pessimistic, as industrial and automotive customers continue reducing inventory, leading to underutilization at its manufacturing sites.
• Vishay faces weakness in industrial and automotive markets, particularly in Europe, due to high inventory levels and sluggish demand.
• Diodes sees extended shutdowns in automotive and industrial markets, particularly in Europe, where soft demand is delaying recovery.

Neutral or Cautious Outlook for 2025

These companies expressed a more balanced perspective, acknowledging growth opportunities while remaining cautious about inventory corrections and supply chain risks. 

• TE Connectivity is cautious but expects sequential growth in Q2, with AI, energy, and aerospace markets supporting expansion. 
• Arrow sees stabilization in industrial markets but remains uncertain about the pace of recovery in mass-market electronics. 
• Renesas acknowledges challenges in industrial demand but sees early signs of recovery in automotive microcontrollers and AI-related data center products. 
• Samsung expects demand recovery in the second half of 2025, but near-term headwinds remain in mobile, PCs, and memory pricing. 
• NXP remains neutral on its 2025 outlook, citing strength in automotive software-defined vehicles and radar, but continued inventory digestion at Tier 1 customers. 
• Skyworks expects steady automotive and IoT demand, but seasonal declines and sourcing changes at key customers will create headwinds.
  

Want a deeper dive into the 2025 electronic component market?

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