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keyword:Mark Liu35 result(s)

Press Releases
Taiwanese Server ODMs Expected to Account for About 90% of Global Server Production in 2021 by Expanding Production Capacities Outside of Domestic China, Says TrendForce

2021/10/13

Semiconductors

Escalating trade tensions between the US and China, rising geopolitical issues, increased tariffs, and uncertainties stemming from the COVID-19 pandemic’s emergence last year have compelled server ODMs to actively shift their operations closer to clients as well as engage in risk mitigation strategies, according to TrendForce’s latest investigations Taiwanese ODMs, in particular, are shifting their production bases away from domestic China and accelerating the installation of additional overseas production lines TrendForce expects the share of servers manufactured in domestic China by global server ODMs to undergo a 7% YoY decrease this year as these ODMs shift their production bases mainly to Taiwan Furthermore, Taiwanese ODMs are expected to account for about 90% of total server production this year On the other hand, server assembly operations, which are closely related to motherboard manufacturing operations, are also dynamically reserving their L6 capacities Server assembly facilities located in New Mexico and the Czech Republic are gradually installing new production lines for server motherboards there Inventec, Wistron (including Wiwynn), and Foxconn all currently possess sufficient motherboard manufacturing capacities for allocation as needed While future changes in the overall server supply chain remains to be seen, it should be pointed out that the migration of production bases pertaining to US companies is of particular importance For instance, North American CSPs have requested their server ODM partners to migrate L6 assembly lines to locations such as Taiwan and Southeast Asia in response to potential geopolitical factors going forward However, servers to be shipped to non-US regions will still be manufactured in China in accordance with prior plans Aside from Google and Facebook, both of which have production lines in Taiwan, AWS and Microsoft have also transitioned their production lines to Taiwan Regarding major server ODMs’ current progress, most of them have installed new production lines in Taiwan, with Inventec, Wistron, Quanta, and Foxconn making the most headway For instance, after installing three additional production lines in Guishan, Taoyuan at the end of 2020, Inventec currently operate a total of eight production lines, while Wistron has not only installed several spare production lines in the Southern Taiwan Science Park, but also planned to expand production bases in Southeast Asia at the end of 2021 for capacity allocation purposes Quanta is aiming to capitalize on demand from 5G-related applications and data center build-outs by continually adjusting its production capacity for motherboards in Taiwan and Thailand Finally, by expanding the physical capacity of its Taoyuan facility, Foxconn is able to avoid incurring tariffs for its North American clients’ L6 assembly operations For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms Latte Chung from the Sales Department at lattechung@trendforcecom For additional insights from TrendForce analysts on the latest tech industry news, trends, and forecasts, please visit our blog at https://insidertrendforcecom/

Press Releases
Server DRAM Prices Expected to Rise by 5-10% QoQ in 3Q21 Due to Peak Season, Says TrendForce

2021/08/11

Semiconductors

Suppliers and clients in the server DRAM market are still having difficulty in reaching agreements on prices for 3Q21 contracts even though the quarter is well underway, according to TrendForce’s latest investigations Hence, server DRAM contract prices are much more varied than before Regarding the price trend in July, contract quotes for the mainstream 32GB RDIMMs rose by 5-7% MoM However, the price hikes have led to a reduction in demand, and there are indications that server DRAM sales bits will register some decline for 3Q21 The release of server CPUs based on the new platforms is driving the procurement of higher-density 64GB RDIMMs, but this has not resulted in a significant corresponding increase in content per unit The general trend for buyers is to replace two 32GB modules with one 64GB module, rather than a one-to-one replacement as DRAM suppliers previously expected Contract prices of 64GB RDIMMs rose by 5-7% MoM for July, though prices were below this range for some transactions TrendForce’s analysis shows that server DRAM suppliers and buyers are finding it difficult to reach a consensus on prices because DRAM suppliers expect that the demand for server DRAM modules is going to surge in 3Q21 as the third quarter is the traditional peak season for the server market As well, suppliers also anticipate that the adoption of new server processor platforms will increase the memory content in servers With a more optimistic demand outlook, suppliers have adjusted their product mixes to allocate more of their production capacity to server DRAM Hence, the supply fulfilment rate has risen significantly in the server DRAM market in 3Q21 Server DRAM buyers, on the other hand, already have a high level of inventory Clients in the data center segment were aggressively stockpiling during the first half of this year due to worries about the impact of the COVID-19 pandemic on the supply chain They now need some time to consume their inventories and are reluctant to procure more DRAM modules Contract prices will be constrained to rise further in 4Q21 as demand side has turned conservative Currently, enterprise server OEMs in North America have finished arranging their quarterly contracts, whereas numerous cloud service providers and Chinese enterprise server OEMs are still in the midst of negotiations TrendForce believes that, in order to reach their targets for sales and shipments, server DRAM suppliers may be willing to cut more “special deals” for server DRAM products in August Specifically, suppliers will push for lock-in contracts that offer adjustable prices for fixed quantity On the whole, the general behaviors of DRAM buyers with regards to procurement have changed noticeably form the first half of this year As the demand related to servers, PCs, and other major applications slows down, the whole DRAM market will gradually shift to the state of oversupply Since the DRAM market is an oligopoly, the major suppliers will still have a significant leverage in price negotiations Quotes for server DRAM products could therefore rise further by 5-10% QoQ in 3Q21 However, given that prices have yet to be finalized for a substantial portion of 3Q21 contracts, the transaction volume is also very limited This, in turn, will inevitably create a lot of uncertainties with respect to the price trend in 4Q21 For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms Latte Chung from the Sales Department at lattechung@trendforcecom For additional insights from TrendForce analysts on the latest tech industry news, trends, and forecasts, please visit our blog at https://insidertrendforcecom/

Press Releases
GCP, AWS Projected to Become Main Drivers of Global Server Demand with 25-30% YoY Increase in Server Procurement, Says TrendForce

2021/04/19

Semiconductors

Thanks to their flexible pricing schemes and diverse service offerings, CSPs have been a direct, major driver of enterprise demand for cloud services, according to TrendForce’s latest investigations As such, the rise of CSPs have in turn brought about a gradual shift in the prevailing business model of server supply chains from sales of traditional branded servers (that is, server OEMs) to ODM Direct sales instead Incidentally, the global public cloud market operates as an oligopoly dominated by North American companies including Microsoft Azure, Amazon Web Services (AWS), and Google Cloud Platform (GCP), which collectively possess an above-50% share in this market More specifically, GCP and AWS are the most aggressive in their data center build-outs Each of these two companies is expected to increase its server procurement by 25-30% YoY this year, followed closely by Azure TrendForce indicates that, in order to expand the presence of their respective ecosystems in the cloud services market, the aforementioned three CSPs have begun collaborating with various countries’ domestic CSPs and telecom operators in compliance with data residency and data sovereignty regulations For instance, thanks to the accelerating data transformation efforts taking place in the APAC regions, Google is ramping up its supply chain strategies for 2021 As part of Google’s efforts at building out and refreshing its data centers, not only is the company stocking up on more weeks’ worth of memory products, but it has also been increasing its server orders since 4Q20, in turn leading its ODM partners to expand their SMT capacities As for AWS, the company has benefitted from activities driven by the post-pandemic new normal, including WFH and enterprise cloud migrations, both of which are major sources of data consumption for AWS’ public cloud Conversely, Microsoft Azure will adopt a relatively more cautious and conservative approach to server procurement, likely because the Ice Lake-based server platforms used to power Azure services have yet to enter mass production In other words, only after these Ice Lake servers enter mass production will Microsoft likely ramp up its server procurement in 2H21, during which TrendForce expects Microsoft’s peak server demand to take place, resulting in a 10-15% YoY growth in server procurement for the entirety of 2021 Finally, compared to its three competitors, Facebook will experience a relatively more stable growth in server procurement owing to two factors First, the implementation of GDPR in the EU and the resultant data sovereignty implications mean that data gathered on EU residents are now subject to their respective country’s legal regulations, and therefore more servers are now required to keep up the domestic data processing and storage needs that arise from the GDPR Secondly, most servers used by Facebook are custom spec’ed to the company’s requirements, and Facebook’s server needs are accordingly higher than its competitors’ As such, TrendForce forecasts a double-digit YoY growth in Facebook’s server procurement this year Chinese CSPs are limited in their pace of expansions, while Tencent stands out with a 10% YoY increase in server demand On the other hand, Chinese CSPs are expected to be relatively weak in terms of server demand this year due to their relatively limited pace of expansion and service areas Case in point, Alicloud is currently planning to procure the same volume of servers as it did last year, and the company will ramp up its server procurement going forward only after the Chinese government implements its new infrastructure policies Tencent, which is the other dominant Chinese CSP, will benefit from increased commercial activities from domestic online service platforms, including JD, Meituan, and Kuaishou, and therefore experience a corresponding growth in its server colocation business; Tencent’s demand for servers this year is expected to increase by about 10% YoY Baidu will primarily focus on autonomous driving projects this year There will be a slight YoY increase in Baidu’s server procurement for 2021, mostly thanks to its increased demand for roadside servers used in autonomous driving applications Finally, with regards to Bytedance, its server procurement will undergo a 10-15% YoY decrease since it will look to adopt colocation services rather than run its own servers in the overseas markets due to its shrinking presence in those markets Looking ahead, TrendForce believes that as enterprise clients become more familiar with various cloud services and related technologies, the competition in the cloud market will no longer be confined within the traditional segments of computing, storage, and networking infrastructure The major CSPs will pay greater attention to the emerging fields such as edge computing as well as the software-hardware integration for the related services With the commercialization of 5G services that is taking place worldwide, the concept of “cloud, edge, and device” will replace the current “cloud” framework This means that cloud services will not be limited to software in the future because cloud service providers may also want to offer their branded hardware in order to make their solutions more comprehensive or all-encompassing Hence, TrendForce expects hardware to be the next battleground for CSPs For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms Latte Chung from the Sales Department at lattechung@trendforcecom

Press Releases
Global Server Shipment for 2021 Projected to Grow by More than 5% YoY, with Successive QoQ Increases in Demand for ODM Direct Servers, Says TrendForce

2021/04/14

Semiconductors

Enterprise demand for cloud services has been rising steady in the past two years owing to the rapidly changing global markets and uncertainties brought about by the COVID-19 pandemic TrendForce’s investigations find that most enterprises have been prioritizing cloud service adoption across applications ranging from AI to other emerging technologies as cloud services have relatively flexible costs Case in point, demand from clients in the hyperscale data center segment constituted more than 40% of total demand for servers in 4Q20, while this figure may potentially approach 45% for 2021 For 2021, TrendForce expects global server shipment to increase by more than 5% YoY and ODM Direct server shipment to increase by more than 15% YoY Global server shipment for 2Q21 is expected to increase by 20% QoQ and remain unaffected by material shortage Thanks to the accelerating pace of enterprise cloud migration and the long queue of unfulfilled server orders last year as a result of the pandemic, server ODMs will likely receive an increasing number of client orders throughout each quarter this year For instance, ODM vendors saw a 1% QoQ growth in L6 server barebones orders from their clients in 1Q21, but this growth is expected to reach 15-18% in 2Q21 TrendForce’s analysis indicates that apart from server ODMs maintaining a strong momentum, server OEMs (or server brands) will also be able to significantly raise their unit shipments in 2Q21 The quarterly total shipments from server OEMs for 2Q21 is currently projected to increase by 20% compared with 1Q21 that was the traditional off-season The COVID-19 pandemic is a major contributor to shipment growth because it has caused a paradigm shift in corporate work practices and spurred companies to accelerate their cloud migrations The effects of the pandemic have also provided a window of opportunity for the traditional server OEMs, including HPE and Dell, to develop new business models such as hybrid cloud solutions or colocation services that allow their customers to pay as they go, in addition to their existing sales of whole servers It should be pointed out that, not only is the shortage of materials within the server supply chain as yet unresolved, but the long lead times for certain key components are also showing no signs of abating However, in response to the pandemic’s impact on the industry last year, server manufacturers have now transitioned to a more flexible procurement strategy by sourcing from two or three suppliers instead of a single supplier for a single component, as this diversification allows server manufacturers to mitigate the risk of potential supply chain disruptions TrendForce therefore believes that the current supply of key components including BMCs and PMICs is sufficient for server manufacturers, without any noticeable risk of supply chain disruptions in the short run Huawei and Inspur maintain brisk server shipments due to favorable domestic governmental policies and demand from cloud service providers China’s server demand, which accounted for about 272% of the global total in 1Q21, continues to grow annually Favorable policies and support from domestic cloud service providers are the main demand drivers in the country Shipments from domestic server OEMs have remained fairly robust in China on account of the build-out of the hyperscale data centers across the country Another reason is that Chinese telecom companies procure servers mostly from domestic manufacturers Taken together, these aforementioned factors directly contributed to the server shipments of Inspur and Huawei in 1Q21 Huawei’s server shipments are relatively unaffected by the US-China dispute, even though the sanctions enforced by the US government constrained Huawei’s component supply The demand for Huawei servers has been boosted by telecom tenders and procurement from domestic enterprise clients A QoQ growth rate of roughly 10% is projected for 2Q21 on account of a new round of government tenders As for the whole 2021, Huawei’s annual shipments are still forecasted to register a YoY growth rate of about 5% Thanks to infrastructure programs and rising orders from data centers, Inspur is expected to capture around 30% of China’s total server demand in 2021 On the matter of product strategy, Inspur already has a sizable ODM business with tier-1 Chinese cloud service providers (ie, Baidu, ByteDance, Alibaba, and Tencent) The volume of incoming orders for the first half of this year will also be quite massive because tier-2 cloud service providers and e-commerce platforms such as JDcom, Kuaishou, and Meituan will be injecting significant demand For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms Latte Chung from the Sales Department at lattechung@trendforcecom

Press Releases
Server DRAM Contract Prices Projected to Rise by 10-15% QoQ in 2Q21 Owing to Limited Production Capacities, Says TrendForce

2021/02/25

Semiconductors

Since 3Q20, memory suppliers’ production capacities allocated to server DRAM have dropped to about 30% of the total DRAM production capacity, according to TrendForce’s latest investigations While this decrease took place as suppliers sought to increase the supply of other DRAM products in higher demand, it also represented an attempt for them to adjust the ASP of various DRAM products Furthermore, since the persistent demand for consumer electronics has shown no signs of slowing down in 1Q21, as of now suppliers have also been maintaining the same capacity allocation as last year However, given that second quarters have traditionally marked the cyclical upturn in server shipment, server DRAM demand is thus expected to ramp up in 2Q21, in turn prompting suppliers to raise their quotes for server DRAM TrendForce is therefore revising up the QoQ increase in server DRAM contract prices for 2Q21 from the original forecast of 8-13% to the adjusted forecast of 10-15%, with certain transactions potentially involving as much as a 20% price hike Server DRAM contract prices are likely to increase by more than 40% throughout the year as demand is likely to persist through 3Q21 With regards to demand, after DRAM prices reached rock bottom at the end of last year, the oversupply situation in the market and the pressure on buyers to destock their inventory have both gradually stabilized by now As prices closed in on historically low levels, buyers became more and more active in their procurement activities In addition, data center demand for server DRAM is set to increase after 1Q21, driven by the increasing cloud migration needs of the post-pandemic “new normal” This demand will likely persist through 2H21, thereby injecting additional growth momentum into the overall server market With regards to supply, on the other hand, DRAM suppliers will be relatively conservative in their capacity expansion efforts this year, with most suppliers having no plans to expand their capacities Also, the oligopolistic nature of the DRAM industry means suppliers generally prioritize profitability over other factors when allocating their production capacities Case in point, the rising popularity of WFH and distance education led suppliers to reallocate their production capacities last year More specifically, suppliers allocated their capacities to first fulfill the high demand from the smartphone and notebook computer markets in 3Q20 As a result, capacities allocated to server DRAM underwent a corresponding decline during this period On the whole, TrendForce expects server DRAM contract prices to increase by about 8% QoQ in 1Q21 and by 3-4% MoM on average within the quarter Moreover, TrendForce also does not rule out the possibility that server DRAM contract prices may experience additional slight MoM increases past this period given that contract prices are negotiated on a quarterly basis Looking ahead, TrendForce indicates that server DRAM will remain in high demand through 3Q21, as geopolitical uncertainties and the shift of work life towards WFH continue to generate upward momentum for server shipment Therefore, server DRAM contract prices are expected to rise by more than 40% cumulatively from late 2020 to late 2021 For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms Latte Chung from the Sales Department at lattechung@trendforcecom

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