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Thanks to the increased adoption of AMOLED panels by major smartphone brands including Apple and Samsung, the penetration rate of AMOLED panels in the smartphone market is expected to reach 39.8% in 2021 and 45% in 2022, according to TrendForce’s latest investigations. As AMOLED panels see increased adoption, the consumption of AMOLED DDI will undergo a corresponding increase as well. However, not only are the process technologies used for AMOLED DDI manufacturing currently in short supply, but some foundries are also yet to finalize their schedules for expanding their AMOLED DDI production capacities. Given the lack of sufficient production capacity, the increase in AMOLED panel shipment may potentially be constrained next year.
This year, the US and Europe, which are Apple’s main markets for iPhone devices, are seeing an easing of the pandemic and expecting an economic recovery. Furthermore, Apple is expected to benefit from Huawei’s abandonment of some market share for high-end smartphones, and the sales of the new iPhone devices in 2H21 will likely be boosted thanks to this development. On the whole, the outlook on Apple’s performance in the smartphone market for the whole year is positive, according to TrendForce’s latest investigations. Although the ongoing capacity crunch in the foundry industry will have a constraining effect on Apple in terms of ramping up its iPhone production and growing its market share in the future, TrendForce is still maintaining a cautiously optimistic view and forecasts that the annual total iPhone smartphone production for 2021 will grow by around 12.3% YoY to 223 million units, with additional room for a slight growth going forward.
The stay-at-home economy generated by the COVID-19 pandemic has galvanized a rising demand for IT products this year, with a corresponding increase in DDI demand as well, according to TrendForce’s latest investigations. More specifically, large-sized DDI demand is expected to increase by as much as 7.4% YoY in 2021, although the availability of 8-inch foundry capacity in the upstream supply chain is expected to increase by a mere 2.5% YoY due to other chips with relatively higher margins occupying much of this capacity. Foundries such as NexChip and SMIC are still continuing to install production capacities this year, and the supply of large-sized DDI will undergo a slight increase as a result. However, these newly installed capacities will be unable to fully alleviate the scarcity of large-sized DDI, which may potentially persist until the end of 2021.
While foundry capacities remained tight, prompting IC design companies to compete over limited foundry capacities in order to fulfill rising demand for various end devices, the top 10 IC designe (fabless) companies posted remarkable revenues in 1Q21, according to TrendForce’s latest investigations. In particular, thanks to the global mining craze brought about by the cryptocurrency market, Nvidia was able to surpass Broadcom in revenue and take the second spot among the top 10. On the other hand, fifth-ranked AMD scored a staggering YoY growth of 92.9%, which is the highest % increase on the top 10 list.
TrendForce’s latest investigations find considerable discrepancy between prices for graphics DRAM products in the contract market and in the spot market. Quotes for graphics DRAM products continue to rise in the contract market as the severe undersupply situation persists. Furthermore, the supply fulfillment rates for orders from some medium- and small-size clients have been hovering around 30%. This undersupply situation is expected to persist through 3Q21, during which graphics DRAM contract prices are expected to rise by 8-13% QoQ. Regarding the spot market, on the other hand, the value of ETH experienced continued uptrend from the start of 2021 until May, thereby driving up the demand for graphics cards, regardless of them belonging to the newer or older series. At the height of the graphics card boom, spot prices of graphics DRAM products were up to 200% higher than contract prices. Demand from miners for graphics cards are expected to be relatively muted before cryptocurrencies return to their previous bullish trends, and the gap between the spot and contract prices of graphics DRAM products will likely narrow in 3Q21 as a result.
