After supply chain problems, geopolitical tensions, the aftermath of the global pandemic, a worsening interest rate outlook and surging inflation made 2022 a difficult year for semis investors, the sector is now on the road to recovery. While U.S. sanctions and macro developments are sources of risk, the key role of semiconductors in the technology value chain should make the sector promising on a long-term view.
Our key takeaways are as follows:
Current weakness in sales of consumer electronics, home appliances, memory, PC & office equipment and smartphones likely to persist over the next two quarters.
Strong demand from automotive, industrial, cloud data centres and telecom infrastructure segments improve the sector outlook.
Increasing tailwinds in all applications, profitability improvements, and overall pricing power should support revenue growth in 2023.