According to the inventory tracking report of Cansheng Industrial Company, the inventory of semiconductor suppliers decreased in the third quarter, ending the previous seven consecutive quarters of increase. The industry has entered a self correction mode to alleviate the problem of oversupply.

The level of semiconductor inventory is an important indicator for measuring the health of the industry and can reflect whether the supply chain has confidence in the future prospects. Low inventory indicates that manufacturers expect a decrease in demand, so they are cautious and take precautions against unfavorable market conditions in the future; And excessive inventory is also a problem, which can lead to oversupply and drive down prices.

In the third quarter, semiconductor suppliers began to initiate inventory correction to alleviate the worsening oversupply situation. Due to the almost stagnant global economy and facing declining orders and visibility, many semiconductor manufacturers have decided to reduce their capacity utilization. And now the delivery time has been reduced to normal levels, no longer needing to wait for a long time like before. Manufacturers are more confident in reducing inventory this time and are not worried about causing too many problems to the supply chain.

Despite manufacturers reducing inventory, the absolute level of inventory days in the third quarter remains high, the highest in the past 10 quarters and the highest since the fourth quarter of 2008, indicating that inventory remains high. In addition, the percentage of oversupply in the third quarter increased to 12.1%, surpassing the 11.1% in the fourth quarter of 2008. Therefore, it is expected that inventory will be further reduced in the fourth quarter.

From the perspective of various semiconductor fields, the inventory days of mobile phone OEMs, distributors, and analog device companies have increased, while the inventory days of fabless companies, memory, OEM manufacturers, PC manufacturers, and storage and electronic manufacturing service providers have decreased.

Mobile phone manufacturers' inventory increased in the third quarter as suppliers prepared for the peak season at the end of the year. The inventory decline of pure OEM manufacturers is greater than expected, which is the result of reducing capacity utilization.

Cansheng Industrial Company predicts that the overall inventory days in the fourth quarter will further decrease by 2.5% to 79.3 days. Due to the volatile global economic situation, visibility in many areas remains low, and the final demand situation is still difficult to predict.