Yageo and other passive component suppliers continue to experience a slowdown in customers orders amid sluggish end-market demand, according to Taiwan industry sources.
With inventory adjustments for consumer electronics and other mass-market ICs taking longer than expected, passive component suppliers have seen customers slow down order pull-ins, the sources indicated. Inventory correction across the consumer electronics industry supply chain is poised to persist through the first half of next year.
Yageo’s capacity utilization rates for commodity products fell to 50-60% in the third quarter of this year, the sources said. The MLCC and chip resistor specialist will continue to see its capacity utilization and product ASPs come under downward pressure in the first half of 2023, the sources noted.
Inventory adjustments for Yageo’s commodity passive components will likely be extended to the end of first-quarter 2023, the sources indicated. Commodity products have already slid as a proportion of Yageo’s total revenue to 25-30%, as the company has put a growing focus on automotive and other niche-market applications.
Yageo expressed previously caution about its business prospects for the rest of 2022, citing uncertainty over the pandemic, electricity use restrictions and city lockdowns in China, and rising inflationary pressure worldwide. The company disclosed its cumulative 2022 revenue through September increased 14.1% on year to NT$92.26 billion (US$2.88 billion).
Yageo has ramped up its shipments for automotive applications to 18-20% of its total sales, and expects to scale up the ratio to 22% in 2023, the company has said.