Chip stocks hit record highs as manufacturers ramp up production in a bid to end shortages

The crisis in the semiconductor industry has forced manufacturers to step up their activities as market demand has far exceeded their current capacity. TSMC had to increase its automotive chip production by 30% in the first half of the year compared to the same period last year. According to the Japanese edition of the Nikkei Asian Review, by mid-year, the top nine chip manufacturers had record-breaking inventories of $ 64.7 billion.

The spring performance of TSMC, Intel, Samsung Electronics, Micron Technology, SK hynix, Western Digital, Texas Instruments, Infineon Technologies, and STMicroelectronics indicated that the listed companies are going to increase production volumes. Automakers have learned a bitter lesson from the deficit that hit the industry late last year and are now opting to stockpile parts for months ahead. At the same time, automakers are trying to increase the number of chip suppliers to reduce risks. Representatives of Infineon Technologies complained about the excessive increase in orders from customers, thanks to which the order book was formed for two years in advance.

Omdia experts expect that in the memory chip market in the next half of the year, supply will exceed the demand and prices will fall. In the meantime, chipmakers are successfully increasing their profits. The ten market leaders in terms of capitalization together increased their net income by 60% compared to the same period last year. TSMC and Intel intend to make significant capital investments in the construction of new production facilities, a similar step is expected from Samsung Electronics.

It's worth noting that the Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest contract chipmaker, recently surpassed Chinese tech giant Tencent to become the most valuable company in the Asian region.

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