Blog: You, us, everyone

INTC, MU, and AMD, amongst others, are exposed to the downturn in the semiconductor industry. This occurred after a difficult 2020 and 2021 where spare capacities were a highly rare item and where the semiconductor industry was requested to expand business capacities to low-end quality processors to keep up with demand to cover rising numbers of home offices, amongst others.

With the market being settled overcapacity, wafers can only implement limited actions, i.e., reducing capacities and keeping capex and opex under tight control so that the oversupply will not aggravate any further. This being said, operating margins will settle around a bearable level which will become the new point of reference. In terms of end market behavior, private consumers (pc and smartphones) and corporations (servers and smartphones) have finalized an upgrading cycle about 18 months ago, hence the hardware sector is about to reach the lower end of the demand before a new replacement cycle is expected to start. For now, the market is skewed rather negatively which offers long-term investors ideal bottom fishing opportunities, and AMD is certainly a name to be considered.