With the cooling demand for electronic products, the chip industry may usher in the "coldest summer".

Recently, chipmaker giant Micron released a much lower-than-expected fourth-quarter guidance, with shares falling more than 6% in after-hours trading, which wall street took as an ominous sign.

Although Micron's revenue for the third quarter is still in line with expectations, the company expects revenue for the fiscal fourth quarter to be $7.2 billion, 21% lower than Wall Street expected. This will lead to a year-on-year decline in revenue for the first time in more than two years.

Meiguang pointed outWeakness in the computer and smartphone markets is the main reason for the gloomy outlook.At a meeting after the results were announced, the company told analysts that they had seen a "significant reduction in demand".

Intel Corp's new chief financial officer also hinted at this, saying at an investor conference in early June:

"the situation is much worse than we expected when we entered the quarter."

Although the demand for data center chips remains high because of the support of cloud services, computers and mobile phones are still the two largest end markets in the chip industry.

Recently, chip chopping has spread to MCU (microcontroller), and among themThe price of consumer applications has fallen the most, once again supporting the shrinking demand in the consumer sector.。

By Friday's close, shares in Intel Corp and AMD were down 3 per cent and 4 per cent respectively, while chipmakers Broadcom Ltd, Qualcomm, Qorvo and Skyworks were also down an average of 2 per cent, most of which will report June results later this month.

Under the influence of these companies, the Philadelphia stock exchange semiconductor index is down 3.8%, and it is down 38% so far this year.

"Semiconductors are a flag."

A more serious problem is that the current pain in the chip industry is likely to spread to more industries.

Chips are widely used in industries that play an important role in economic growth: automobiles, consumer electronics, home appliances, data centers, etc.So if the chip is not in good condition, it will lead to demand problems in other areas of the economy.。

Historically, chip stocks have been a key barometer of the stock market and the economy. Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder, said:

"this weakness indicates that the economy is slowing and there is a possibility of a recession."

Chips are a flag because they do exist in everything. They are indispensable to everything sold today. They are the most basic equipment, so this is a major negative impact on the economy. "

The shortage of chips has energized the industry after a surge in demand for everything from cars to phones to cloud services. As the pandemic fades away,The recovery in demand is supposed to bring more rebound to the chip industry, but this does not seem to be the case.

Miller Tabak + Co. Matt Maley, a senior strategist, says that if the chip is not in good condition, it will lead to demand problems in other parts of the economy, which is a disturbing sign:

"We don't have enough chips, but demand is falling."

"what signal does this send? It highlights a growing concern that the slowdown we are experiencing will turn into a recession. "