NEWS TECHNOLOGIE

(Photo: Samsung) Enthusiasts recently breathed a sigh of relief as the GPU shortage came to an end. The collapse of cryptocurrency means GPUs have rapidly become available, with some even selling below MSRP. We’re not out of the woods yet though, according to a new report. One of the largest suppliers of raw materials used to make silicon wafers is experiencing unexpected price hikes it must pass on to customers like TSMC. TSMC will likely then pass those costs along to their customers, and so forth. In the end, you could see the result of this pricing chain reaction when next-gen CPUs and GPUs arrive this fall.

Tokyo-based Showa Denko supplies chemicals and other base materials to companies like TSMC and Toyota. It provides these materials early in the supply chain, so price changes typically affect upstream manufacturing costs. Bloomberg reports the company has already experienced a dozen price hikes this year alone, with more on the way. The catalysts for this upheaval are COVID-19 lockdowns, the war in Ukraine, and a weakening of the Japanese currency. Showa Denko’s Chief Financial Officer Hideki Somemiya told Bloomberg the pricing situation has caused it to begin dropping unprofitable product lines as a result. He also doesn’t expect the situation to improve until sometime in 2023 either.

Samsung’s 3nm GAA MBCFET design is likely to get a lot more expensive for its customers. (Image: Samsung)

“A big theme this year common to all the players in the materials industry is how much cost burden we’d be able to convince customers to share with us,” he told Bloomberg. “The current market moves require us to ask twice the amount we had previously calculated.” Bloomberg has previously reported that both Samsung and TSMC have already notified their customers of impending price hikes. It’s not clear what TSMC is planning, but Samsung is reported to be looking at a 20 percent price increase. The impact of these price changes will likely be felt far and wide. The article says it will affect consumers of “durable goods,” which are products meant to last a long time.

This is just another factor that is contributing to a period of uncertainty for the semiconductor industry. Previously we noted the industry at large was experiencing a sense of “pessimism.” This is due to the economic forces driving up prices and possibly even delaying products. Digitimes just reported that TSMC’s three biggest customers — Apple, AMD, and Nvidia — have already asked it to reduce future wafer orders.

Such an unprecedented request is causing anxiety throughout the industry. Silicon customers rarely look to scale back plans they made years ago. All this will lead to an interesting second half of 2022. AMD, Intel, and Nvidia are looking to launch their next-generation products in an uncertain environment. With the GPU shortage officially over, it remains to be seen what pricing and supply will look like. Given the current inflation levels, as well as the rumored performance levels on offer, it’s not hard to predict next-gen GPUs and CPUs will cost a pretty penny.

Now Read:

• Analyst: AMD’s PC Revenue To Drop 26 Percent in 2022 YoY
• Samsung Becomes First Foundry to Begin Production at 3nm
• Intel 4 is a Major Step on Intel’s Path Back to Semiconductor Dominance

 

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