The global laptop and PC market is gradually recovering, coupled with the rising trend of AIPC. Laptop brands, including Acer and ASUS, as well as major contract manufacturers like Foxconn and Quanta, have all released positive outlooks for 2024.

Semiconductor giants such as Intel, NVIDIA, AMD, Qualcomm, and others actively entered the AI PC chip market in the second half of 2023, positioning themselves strategically. Both laptop brands and terminal manufacturers have expressed expectations for this development.

Acer

Jason Chen, Chairman and CEO of Taiwan-based computer manufacturer Acer, stated on November 30th that they are currently tallying the sales performance of Acer during Black Friday and Cyber Monday, and the current results are satisfactory. Looking ahead to the PC industry next year, from an overall economic perspective, there are still many uncertain factors, but it appears to be better than this year.

Chen further pointed out that the impact of the pandemic has passed, inventory digestion has also concluded, and entering the traditional seasonal performance, the specific application of generative AI will bring a new wave of demand stimulation.

Regarding AI PCs, Chen emphasized that the transition to AI PCs will be a gradual process rather than a sudden occurrence. He anticipates this transformation will take place in both commercial and consumer markets in the future.

ASUS 

According to UDN’s report, ASUS, another major Taiwanese laptop manufacturer, emphasized the significance of AI PCs during its November investor conference. Co-CEO, S.Y. Hsu, highlighted that AI PCs represent a crucial turning point for the industry, promising a significant improvement in user experience and ushering in a new era for the PC industry.

While he acknowledged that consumer acceptance of AI PCs would take time to increase, he predicted that the penetration rate of AI PCs would reach single digits in 2024 and double digits in 2025, depending on the user experience and technological maturity of AI PCs next year.

Foxconn

For Taiwanese electronics contract manufacturer Foxconn, the outlook for the PC industry in the coming year is described as “very good” by Chiang Chih-Hsiung, General Manager of the B Group and Digital Health at Foxconn.

This indicates Foxconn’s positive expectations for performance in the PC-related industry. Foxconn had previously emphasized that, in addition to AI servers, it would collaborate with customers to expand its presence in the AI PC sector in 2024.

Quanta

In a public interview on November 30th, Chairman Barry Lam of Taiwanese electronics manufacturer Quanta discussed the overall outlook for the next year, emphasizing the role of generative AI in shaping future technological developments.

With the rapid growth in AI computing power demand, the market conditions for next year are quite optimistic. Lin is particularly bullish on the future prospects of three major products: AI PC, AI servers, and AI automotive electronics, with a special emphasis on the significant growth potential of AI PCs.

Quanta is optimistic about the growth momentum in this sector, especially with Microsoft set to launch the latest Windows featuring AI functions next summer. Quanta envisions continued collaboration with GPT in the future for PCs.

TrendForce’s Insight

TrendForce reports the global shipment of notebooks is expected to reach 167 million units in 2023—a YoY decrease of 10.2%. However, with inventory pressures easing, the notebook market is anticipated to return to a balanced supply and demand cycle in 2024. Overall shipment volume is forecast to reach 172 million units, marking a YoY increase of 3.2%.

As for AI PC, TrendForce believes that due to the high costs of upgrading both software and hardware, early development will be focused on high-end business users and content creators. This targeted group has a strong demand for leveraging AI processing capabilities to improve productivity efficiency and can also benefit immediately from related applications, making them the first-generation primary users.

The emergence of AI PCs is not expected to necessarily stimulate additional PC purchase demand. Instead, most upgrades to AI PC devices will occur naturally as part of the business equipment replacement cycle projected for 2024.

Nevertheless, looking to the long term, the potential development of more diverse AI tools—along with a price reduction—may still lead to a higher adoption rate of consumer AI PCs.

Read more

• Key Development Period for AI PCs in 2024; Global Notebook Market Set to Rebound to Healthy Supply-Demand Cycle with an Estimated Growth Rate of 3.2%, Says TrendForce

(Photo credit: Pixabay)

According to TechNews’ report, TSMC and Samsung fiercely compete in the semiconductor foundry sector. Earlier market reports suggested that Qualcomm’s Snapdragon 8 Gen 4 mobile processor might adopt a dual-foundry strategy with TSMC and Samsung manufacturing simultaneously.

However, according to the latest industry information, due to Samsung’s conservative expansion plan for next year’s 3nm production capacity and unstable yields, Qualcomm has officially canceled the plan to utilize Samsung for next year’s processors. The dual-sourcing model is now postponed until 2025.

Samsung began mass production of its first-generation 3nm GAA (SF3E) process at the end of June last year, marking Samsung’s initial use of the innovative GAA architecture for transistor technology. The second-generation 3nm process, 3GAP (SF3), will utilize the second-generation MBCFET architecture, optimizing it based on the foundation of the first-generation 3nm SF3E. It is expected to enter mass production in 2024.

The dual-foundry strategy for Qualcomm was initially leaked by the reputable source Revegnus via the X platform (formerly Twitter). It was mentioned that the Snapdragon 8 Gen 4 processor would adopt TSMC’s 3nm (N3E) process, while Samsung’s 3GAP process would be used for the Snapdragon 8 Gen 4 supplying Samsung’s Galaxy series smartphones. Other sources suggested that due to limited capacity at TSMC’s 3nm production, Qualcomm had to seek Samsung as an alternative chip foundry.

As a result, Qualcomm originally anticipated dual-foundry production with both TSMC and Samsung in 2024, with hopes of being the first customer for the 3GAP process. However, considering Samsung’s conservative 3nm production capacity plan for next year and the instability in yields, Qualcomm decided to scrap the plan and exclusively rely on TSMC, pushing the dual-foundry strategy to 2025.

Currently, TSMC’s 3nm process technology capacity is on the rise, with expectations that by the end of 2024, monthly production capacity will reach 100,000 wafers, and the revenue contribution will increase from the current 5% to 10%.

(Photo credit: Qualcomm)

Read more

• [News] IC Design Companies Seek Advanced Process Second Source, Overview of Competition Between TSMC and Samsung
• [News] Samsung Reportedly Lands a 4nm Mega Order – Why is AMD Switching to “Dual Foundry Mode” for Its Next-Gen Chips?

Foxconn has announced plans to invest over USD 1.5 billion in expanding its facilities in India. This substantial investment, a rarity in recent years, has sparked speculation that Foxconn is preparing for the introduction of new iPhone products in India.

Due to reports suggesting that in the second half of 2024, Apple will initiate the design, development, and trial production process for the iPhone 17 in India, if true, this would mark the first time in iPhone history that a New Product Introduction (NPI) is conducted outside of China, solidifying India as a potential global iPhone production hub.

Foxconn’s subsidiary, Foxconn Hon Hai Technology India Mega Development Private Limited, disclosed the plan to build the factory locally, with an expected investment of INR 128.209 billion (approximately USD 1.537 billion). This move is seen as a strategic effort to enhance iPhone production capacity in India.

According to TrendForce’s estimate, the proportion of iPhones produced in India is still below 10% in 2023, expected to reach 25-30% by 2025, and projected to achieve 35-40% by 2028. TrendForce believes that with the stable production base of Foxconn in India, it can indeed expand the output.

Analyst Ming-Chi Kuo from TF International Securities disclosed that Apple is placing a growing emphasis on the Indian market. The company intends to kick off the NPI process for the standard edition of the iPhone 17, slated for release in the second half of 2025, in India during the latter part of 2024.

Kuo further highlighted that this development signifies the first instance of a new iPhone model being developed outside of China. Choosing the standard version of the iPhone for development lowers the design complexity, reducing risks. This year, 75-80% of iPhones produced in India are manufactured by Foxconn.

According to a previous report by Indian media Economic Times, Foxconn’s factory in Tamil Nadu, India, has been producing the iPhone 15 Plus in the fourth quarter of this year and has already started production of the standard version of the iPhone 15.

Before the iPhone 14, only a small portion of Apple’s phones were assembled in India, with shipments lagging six to nine months behind those in mainland China. However, this year, India has officially entered the supply chain for the initial batch of new iPhones.

Foxconn’s India representative, V Lee, previously stated that the company was “aiming for another doubling of employment, FDI (foreign direct investment), and business size in India” by next year. However, no further details were provided.

In other product areas, there have been recent reports that three subsidiaries of the Foxconn Group will be among the first approved list of incentives for information technology (IT) production in India. Foxconn Group is also accelerating its layout for manufacturing and components in India.

(Photo credit: Apple)

Luxshare, a crucial player in the Chinese Apple supply chain, is facing challenges in its Indian expansion plans due to the strained relations between China and India. Several Indian media outlets reported that Luxshare has revised its initial investment plan of $330 million, opting to forgo establishing manufacturing facilities in India, stating, “This decision is a setback for India.”

Following these reports, Luxshare clarified on the evening of the 20th that the mentioned reports are inaccurate, emphasizing that Luxshare has not made any $330 million investment decisions in India.

Akin to Taiwanese companies, Chinese companies have been establishing manufacturing facilities in India in recent years as Apple gradually diversifies its supply chain to Vietnam, India, and other locations, reported by ET Telecom. Earlier this year, the Indian government tentatively approved approximately 14 Apple suppliers from China, including Luxshare and Sunny Optical.

However, the condition for approval required these Chinese companies to form joint ventures with local businesses, becoming a hindrance for Chinese investments in India. As a result, some companies are exploring alternative locations. On November 9th, the Bac Giang Industrial Zones Authority in Vietnam announced that Luxshare would make an additional investment of $330 million to construct new production facilities in the province. Indian media interpreted this change in plans by Chinese companies as “India’s loss and Vietnam’s gain.”

In June of this year, Luxshare shareholders expressed concerns about the company’s recent challenges in India. However, Luxshare’s top management emphasized the necessity of comprehensive guarantees in investment, politics, customer relations, and other aspects before contemplating the establishment of manufacturing facilities in India. Currently, Luxshare remains focused on consumer electronics in Vietnam, while maintaining automotive and communication production lines in Mexico.

Chinese media also highlighted that, amid the current tensions in Sino-Indian relations, another major Apple supplier in China, BYD, is facing a similar situation. Previously, BYD planned to expand its presence in India and attempted to establish an iPad assembly line in February 2021. However, BYD announced that this investment had shifted to Vietnam in May, with plans to invest USD 184 million in the production of electronic components.

(Image: Luxshare)

According to CNA’s news, the potential business opportunities in artificial intelligence have spurred major tech giants, with NVIDIA, AMD, Intel, MediaTek, and Qualcomm sequentially launching products featuring the latest AI capabilities.

This AI arms race has expanded its battleground from servers to smartphones and laptops, as companies hope that the infusion of AI will inject vitality into mature markets.

Generative AI is experiencing robust development, with MediaTek considering this year as the “Generative AI Year.” They anticipate a potential paradigm shift in the IC design industry, contributing to increased productivity and significantly impacting IC products.

This not only brings forth new applications but also propels the demand for new algorithms and computational processors.

MediaTek and Qualcomm recently introduced their flagship 5G generative AI mobile chips, the Dimensity 9300 and Snapdragon 8 Gen 3, respectively. The Dimensity 9300, integrated with the built-in APU 790, enables faster and more secure edge AI computing, capable of generating images within 1 second.

MediaTek points out that the smartphone industry is experiencing a gradual growth slowdown, and generative AI is expected to provide new services, potentially stimulating a new wave of consumer demand growth. Smartphones equipped with the Dimensity 9300 and Snapdragon 8 Gen 3 are set to be released gradually by the end of this year.

Targeting the AI personal computer (PC) market, Intel is set to launch the Meteor Lake processor on December 14. Two major computer brands, Acer and ASUS, are both customers for Intel’s AI PC.

High-speed transmission interface chip manufacturer Parade and network communication chip manufacturer Realtek are optimistic. The integration of AI features into personal computers and laptops is expected to stimulate demand for upgrades, leading to a potential increase in PC shipments next year.

In TrendForces’ report on November 8th, it has indicated that the emerging market for AI PCs does not have a clear definition at present, but due to the high costs of upgrading both software and hardware associated with AI PCs, early development will be focused on high-end business users and content creators.

For consumers, current PCs offer a range of cloud AI applications sufficient for daily life and entertainment needs. However, without the emergence of a groundbreaking AI application in the short term to significantly enhance the AI experience, it will be challenging to rapidly boost the adoption of consumer AI PCs.

For the average consumer, with disposable income becoming increasingly tight, the prospect of purchasing an expensive, non-essential computer is likely wishful thinking on the part of suppliers. Nevertheless, looking to the long term, the potential development of more diverse AI tools—along with a price reduction—may still lead to a higher adoption rate of consumer AI PCs.

Read more

• Key Development Period for AI PCs in 2024; Global Notebook Market Set to Rebound to Healthy Supply-Demand Cycle with an Estimated Growth Rate of 3.2%, Says TrendForce

(Image: Qualcomm)