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Display panel prices exhibited a remarkable QoQ increase in 3Q20, a rare occurrence in recent years, according to TrendForce’s latest investigations. In particular, prices for NB (notebook computer) panels increased by 5-10% QoQ during the quarter, while the corresponding increase in TV panel prices reached above 30%. Since the supply of large-sized panels is expected to exceed demand by a mere 0.2% in 4Q20, the shortage situation for certain panel applications is expected to persist, meaning panel prices may potentially increase by as much as 10% QoQ in 4Q20.
Based on sanctions imposed on Huawei by the U.S. Bureau of Industry and Security on August 17, semiconductor components containing U.S.-originated technologies or software from September 15 onward can no longer be shipped to Huawei without permission from the U.S. Department of Commerce. TrendForce indicates that Huawei has been amassing a strategic reserve of components from U.S. suppliers since 2019 in hopes of lessening the impact of the tightening trade restrictions on its device production later on. According to TrendForce’s latest analysis, Huawei’s annual smartphone production for 2020 will still reach around 170 million units. This figure is a downward correction of about 10% compared with the earlier projection of 190 million units (based on the series of export control rules levied against the company on May 15). Later revisions to the brand’s annual production volume will depend on the sufficiency status of materials.
Due to server ODMs’ higher-than-expected inventory of server barebones in 3Q20, additional server orders from the ODMs’ clients came to a screeching halt, therefore resulting in a QoQ decrease in overall server orders for the quarter, according to TrendForce’s latest investigations. As ODMs gradually destock their inventories of server barebones in 4Q20, data center operators are expected to step up their server procurement activities as well, albeit to a far lesser extent than 2Q20. However, given the excess inventory of server barebones, one to two quarters are needed to correct this situation, meaning ODMs will be unlikely to restart their procurement of server DRAM and server components until late 2020 or early 2021. In light of the fact that server manufacturers still hold a relatively high inventory of server DRAM, TrendForce is now forecasting a 13-18% QoQ decline in server DRAM prices for 4Q20.
Demand for notebook computers (NBs) across the globe experienced an explosive growth in 2Q20 due to increased WFH and distance education demand generated by the COVID-19 pandemic, according to TrendForce’s latest investigations. Of all product categories within the NB market, Chromebooks are expected to exhibit the highest percentage of YoY shipment growth for 2020. TrendForce currently projects total Chromebook shipment for 2020 to reach 24.3 million units, a 42.4% increase YoY. As WFH and distance education demand continues to propel the NB market, TrendForce expects total NB shipment to reach 55 million units for 3Q20, a 4% increase QoQ.
Given the high demand for display panels, a tight supply situation for DDI has begun to surface in 2H20, according to TrendForce’s latest investigations. As prices of foundry services rose due to the tight supply of foundry capacity, IC suppliers’ DDI quotes to panel makers in turn also began rising in 3Q20. This uptrend in DDI quotes will potentially continue in 4Q20.
