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Future Horizons Industry Update Webinar IFS 2025

Future Horizons Industry Update Webinar IFS 2025
by Daniel Nenni on 09-16-2025 at 2:00 pm

Key Takeaways

  • The semiconductor industry faces significant geopolitical challenges, including U.S.-China tensions and nationalistic economic policies, which disrupt post-WWII trade norms.
  • Market outlook for 2025 is mixed; growth in the first half relies heavily on AI-driven ASPs, while there are underlying weaknesses and concerns about a potential AI 'hangover' in the second half.
  • Key metrics such as unit shipments have not fully recovered, with excess inventory issues complicating supply chains and signaling a delayed true recovery.

Four Horsemen of the Semiconductor Apocolypse 2025

The Future Horizons Industry Update Webinar, presented today by Malcolm Penn, provides a comprehensive analysis of the semiconductor industry’s current state and future trajectory. Founded in 1989, Future Horizons leverages over 300 man-years of experience, emphasizing impartial insights from facts (e.g., IMF economy data, WSTS units/ASPs, SEMI capacity), sentiment (hype vs. reality), and decades of expertise. The agenda covers industry updates, outlooks on economy, unit demand, capacity, and ASPs, market forecasts for 2025-2026, key takeaways, and Q&A.

Malcolm opens by highlighting “truly extraordinary times,” driven by Trump 2.0’s “America First” agenda, which abandons free trade norms, raises tariffs to 1930s levels, and pivots to national interests. Geopolitical tensions—Netanyahu’s Gaza actions, Putin’s Ukraine aggression, Xi’s Taiwan threats—and China’s rise as a superpower challenge U.S. dominance, shattering post-WWII peace.

The market outlook is mixed: 1H-2025 growth relies on ASPs from the AI data center boom, masking non-AI weaknesses, excess CAPEX, and bloated inventories. Doubts emerge on AI’s ROI amid “insane” spending, with YoY revenue plateauing and a fragile U.S. economy. For 2H-2025, expect more of the same plus worsening economics, urging preparation for an AI “hangover” in a head (fundamentals) vs. heart (frenzy) battle.

Framing the analysis around the “Four Horsemen of the Semiconductor Apocalypse”:
  • Economy: Precariously unclear, with “tenuous resilience amid persistent uncertainty” (IMF July 2025). U.S. defies gloom, but EU/China stagnate; Trump shocks absorbed but risks linger. U.S. cost-of-living fears (70% worry income lags inflation) and Fed’s dual mandate conundrum (employment vs. prices) add pressure, with a September 17 rate cut a “dead certainty” but damned either way.
  • Unit Shipments: Yet to recover fully; July at 7.6b/week, 8% below peak, with unmeasured excess inventory choking supply chains (20b repaid of January’s 58b excess). Real recovery awaits unit growth resumption.
  • Capacity: CapEx stubbornly high at ~15% of SC sales vs. 11% trend, abnormal post-2022 crash. China is the culprit, accelerating to 34% global share (decoupling/tariffs-driven), 3x justifiable levels, focusing on non-leading edge but advancing (e.g., Huawei/SMIC 5/7nm). Domestic WFE vendors rise, closing markets; turning CapEx to capacity proves challenging (US$50-100b lost). India now ramps up ambitiously.
  • ASPs: Strong recovery from June 2022 crash ($1.11 to $1.85 peak), but plateauing/oscillating since December 2023. All sectors retreat except logic (TSMC’s SoC pseudo-monopoly holding prices). Long-term trend reverts to $1 (Moore’s Second Law), with disruptions temporary.

Future Horizons Forecast Update 2025

Forecasts: 2025 at +16% ($731.6b, range 15-17%), ASP-driven with early recovery in discretes/opto/analog; 2026 at +12% ($813.1b, range 6-18%), assuming no AI slowdown, stable geopolitics/economy, and unit rebound. Risks include AI crash, China dumping, overcapacity on mature nodes.

Bottom line: Technology roadmap to 2039 (GAA transition challenging, four-horse race: TSMC N2, Intel 18A, Samsung SF2, Rapidus 2nm). Power semis favor silicon over SiC/GaN/diamond; Makimoto’s Wave holds through 2037 (chiplets next). Packaging evolves from begrudging to enabling (ASATs vs. foundries). Next disruption: quantum computing, not AI (just improved tools). AI data center “madness” (e.g., 10GW plants, underwater/floating) and smart glasses echo 1970s watch disasters—ego over wisdom, fruition decades away. Chip drivers remain Moore’s Law, legislation, A/D conversion, geographic shifts—entertaining, drudgery-removing, enabling impossibles.

Malcolm also warns of structural risks (excess capacity, low utilization, economic tilts to bear), urging caution amid AI hype. Promotes monthly reports for tracking fundamentals., The next webinar January 20, 2026 which will be a must see round-up of 2025.

Also Read:

MediaTek Develops Chip Utilizing TSMC’s 2nm Process, Achieving Milestones in Performance and Power Efficiency

Advancing Semiconductor Design: Intel’s Foveros 2.5D Packaging Technology

Rapidus, IBM, and the Billion-Dollar Silicon Sovereignty Bet

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