News
According to a report by the Economic Daily News, U.S. chip giant Marvell Technology has announced that it will raise prices across its entire product line starting January 1 next year, marking the first major price hike in the optical communications sector.
Marvell’s strong financial performance last quarter, fueled by surging demand for AI-related products like ASICs and silicon photonics for data centers, surprised the market. The decision to raise prices is seen by industry insiders as not only a move to capture emerging opportunities but also a reflection of the continued investment in cutting-edge and innovative product development to meet growing market demand.
The Economic Daily News cited a leaked price hike notification letter signed by Marvell’s Senior Vice President of Global Sales, Dean Jarnac. The letter highlighted that the global demand for accelerated computing and AI is driving unprecedented investments across the semiconductor supply chain, including expanding production capacity and establishing diverse manufacturing bases. Marvell is no exception, and it plans to continue investing heavily in innovation to deliver advanced products and technologies to its customers.
Jarnac explained that the price increases, effective January next year, are necessary to support expanded investment levels. He assured customers that Marvell will minimize the price hike’s impact as much as possible and urged them to place orders based on delivery schedules and provide accurate demand forecasts.
Marvell’s stellar quarterly results were driven by the booming AI demand, which boosted its data center business far beyond market expectations. Key growth drivers included optical products like 800G PAM and 400ZR data center interconnect (DCI) solutions.
“Marvell’s second quarter revenue grew 10% sequentially, above the mid-point of guidance driven by strong demand from AI. We saw strong growth from our electro-optics products, and our custom AI programs began to ramp,” said Matt Murphy, Marvell’s Chairman and CEO, in an August press release. “Next quarter, we expect our combined enterprise networking and carrier end markets to return to growth, while our data center end market growth accelerates. As a result, for the third quarter of fiscal 2025, we expect all our end markets to grow sequentially, with consolidated revenue forecasted to grow 14% sequentially at the mid-point, accompanied by a significant increase in operating leverage.”
(Photo credit: Marvell)
News
As per a report from Bloomberg citing sources, Finnish telecommunications company Nokia is said to be having discussions on potential options for selling its mobile network business, of which is estimated to be valued at around USD 10 billion.
The sources cited in the report indicated that Nokia has been discussing various options for handling its mobile network assets with advisors. Its mobile network division has been facing tough competition from larger rivals like Huawei in recent years. Possible scenarios under consideration by Nokia include partial or full sale, spin-off, or merger with a competitor.
Sources further reveal that Samsung has shown preliminary interest in acquiring part of Nokia’s mobile network assets to expand its presence in radio networks, which connect user phones to telecommunications infrastructure. Additionally, any asset sale by a competitor naturally attracts interest from rivals.
Regarding the rumor, a Samsung representative declined to comment, while a Nokia spokesperson stated that the company is committed to the success of its mobile network business, which holds high strategic importance for the company.
In a statement released after publication, Nokia stated to Bloomberg that it has “nothing to announce” and mentioned that there is “no related insider project.”
Nokia, which was once the world’s top mobile phone supplier, eventually sold its mobile phone business after losing market share to Apple and Samsung. Since then, the company has shifted its focus to producing equipment for communication networks, including the hardware that transmits signals for mobile devices.
During the early phase of the 5G upgrade, demand from telecom service providers in the mobile communications market was strong.
However, this demand has begun to decline, reportedly due to delays in network upgrades, especially in Europe. This further suggests that Nokia may need to seek new business opportunities to reduce its reliance on the telecom network deployment market.
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(Photo credit: Nokia)
News
According to data released by the Semiconductor Equipment Association of Japan (SEAJ) on August 27th, Japan’s semiconductor manufacturing equipment sales continue to soar, with July sales up by about 20%, marking four consecutive months of double-digit growth. Sales from January to July reached a historic high for the period.
Reportedly, the sales of Japan-made chip equipment in July 2024 (based on a 3-month average basis, including exports) reached JPY 348.092 billion, a significant 23.6% increase compared to the same month last year.
This marks the seventh consecutive month of growth and the fourth consecutive month with over 10% growth. Monthly sales have surpassed JPY 300 billion for nine straight months.
Compared to the previous month (June 2024), sales increased by 1.2%, marking the eighth monthly growth in nine months.
From January to July 2024, Japan’s chip equipment sales totaled JPY 2.480115 trillion, a 16.7% increase compared to the same period last year. This figure surpasses the previous record of JPY 2.134268 trillion set in 2022, setting a new all-time high.
The upward trend is in accordance with the observation by Japan’s chip equipment giant Tokyo Electron (TEL) and the Semiconductor Equipment and Materials International (SEMI).
Tokyo Electron (TEL) announced in its August 8 financial report that due to strong investments in AI servers, the 2024 global wafer fab equipment (WFE) market size has been revised upward from the previous estimate of around USD 100 billion (up 5% year-on-year) to over USD 100 billion.
The Semiconductor Equipment and Materials International (SEMI) forecast report released on July 10 predicts that global chip equipment sales in 2024 are estimated to increase by 3.4% year-over-year to USD 109 billion, surpassing the USD 107.4 billion record set in 2022.
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(Photo credit: TEL)
Press Releases
With the approach to the end of 2023, TrendForce revealed the tech trends in every sector, apparently, AI continues as the main focus to decide the direction of how the tech supply chain will be in the next few years, here are the seeings:
CSPs increase AI investment, driving a 38% growth in AI server shipments by 2024
HBM3e set to drive an annual increase of 172% in HBM revenue
Rising demand for advanced packaging in 2024, the emergence of 3D IC technology
NTN is set to begin with small-scale commercial tests, broader applications of this technology are on the way in 2024
6G communication to begin in 2024, with satellite communication taking center stage
Innovative entrants drive cost optimization for Micro LED technology in 2024
Intensifying competition in AR/VR micro-display technologies
Advancements in material and component technologies are propelling the commercialization of gallium oxide
Solid-state batteries poised to reshape the EV battery landscape over the next decade
BEVs in 2024 rely on power conversion efficiency, driving range, and charging efficiency
Green solutions with AI simulations emerging as a linchpin for renewable energy and decarbonized manufacturing
OLED’s expansion will across various applications driven by the innovation of foldable phones
Insights
Swedish telecom giant Telia, along with Nokia and MediaTek, successfully completed 5G Redcap field testing in Finland. During this endeavor, Telia utilized its Finnish base stations and concurrently deployed a 5G Standalone Network (SA) core on MediaTek’s 5G Redcap testing platform.
The test also included mobility sections to ensure signal transmission. The successful test of 5G Redcap field in cooperation with Nokia and other partners opens the doors for the extensive adoption of various low-power network (LPN) applications, including wearables and industrial sensors in the 5G network.
TrendForce’s Insights:
With the aim of increasing overall application of global 5G market penetration and raising the average revenue per user (ARPU), international telecom operators have initiated 5G Redcap field validation. Notably, Thailand’s leading telecom, Advanced Info Service (AIS), collaborated with the global equipment supplier Huawei in September 2023 to successfully complete Thailand’s inaugural 5G Redcap commercial test.
The test involved conducting peak data transfer rate measurements, mobility rate assessments, and validation of coexistence between enhanced Mobile Broadband (eMBB) terminal devices (UE) and Redcap across a variety of 5G Redcap commercial terminals operating in 700-2600MHz frequency bands.
Taking a closer look at China’s major telecommunications companies, China Unicom is leveraging Huawei’s extensive equipment deployment capabilities. The incorporation with Unicom’s 5G RedCap module into surveillance cameras at premier 5G Smart Commercial Park, Zhejiang, China. This integration facilitated 4K high-definition image recognition and enabled facial recognition and monitoring of vehicle violations within the park via Multi-access Edge Computing (MEC) platforms.
In summary, China’s major telecom operators have initiated substantial 5G Redcap commercial deployments and have enthusiastically adopted key IoT applications such as industrial sensors and video surveillance. The scale of these deployments highlights that, driven by 5G Redcap policies, China’s telecom companies have identified viable scenario applications through intensive field deployments.
In contrast, telecom operators in other regional markets have conducted only a limited number of field validation. They are cautiously assessing the effectiveness of 5G Redcap in the market, resulting in a relatively slower pace of 5G Redcap development.
Despite the initiation of small-scale 5G Redcap field validations by telecom companies, the current penetration rate of standalone networks (SA) still lags behind that of Non-Standalone networks (NSA). This disparity restricts the scale of 5G Redcap development.
International telecom operators recognize that the adoption of 5G Redcap, known for its low cost and rapid user acquisition, can effectively boost 5G NR penetration rates, thus potentially accelerating the deployment of standalone networks and expanding the commercial scale of 5G Redcap.