Industry Leaders Lower Forecasts as MLCC Shipments Expected to Decline 7% in Q1 2024

The global economic slowdown has significantly impacted the tech sector, as industry leaders such as Intel and Texas Instruments signal a downturn on their recent financial forecast, mirroring a broader pattern of subdued order placements and shipments across the industry. 

TrendForce reports a projected 7% decrease in MLCC shipments for the first quarter of 2024, attributed to a concurrent decline in global market demand. The reduction is estimated to amount to approximately 1.1103 trillion units. 

The MLCC market, which plays a crucial role in various industries, including consumer electronics, automotive, and telecommunications, is expected to see a downturn in the coming months. TrendForce's analysis indicates that the dip in MLCC shipments is part of a broader trend affecting the global semiconductor market. With demand softening and supply chain challenges, semiconductor manufacturers are encountering heightened pressure to recalibrate production levels and optimize inventory management. 

However, amidst this global economic slowdown, there's a glimmer of hope fueled by companies like Nvidia and AMD that have bolstered their supply chains, leading to a resurgence in demand for AI chips. 

Despite the uptick in AI chip demand, other sectors like smartphones, PCs, notebooks, and general-purpose servers are experiencing stagnation. The absence of significant pre-holiday procurement and a generally subdued market demand paint a cautious outlook for the first quarter. 

On the other hand, the Chinese smartphone market continues its procurement momentum from the previous quarter, Apple's smartphone orders have witnessed a notable decline of nearly 20% in the first quarter. 

The supply of notebooks and general-purpose servers remains steady, but disruptions in major shipping lanes have led to longer shipping times. However, there hasn't been a significant increase in OEMs placing early orders with ODMs, reflecting a subdued outlook for the first quarter. TrendForce predicts that if orders do not improve in March, the average B2B ratio for MLCC suppliers may decrease by 3.3% from the previous quarter. 

Despite the challenges, there is anticipation in the market surrounding Intel's 2024 Meteor Lake platform. With enhanced AI capabilities thanks to additional NPUs, this platform is expected to drive demand for MLCCs due to higher power consumption and operational temperatures. Each device will require around 90-100 additional capacitors, particularly in key specifications like 2.2u 0201, 10u 0402, and 4u 0603. 

As new platform models are gradually introduced in the second half of the year, demand for MLCCs is expected to grow, even if overall notebook orders remain constant or see slight increases.