Electronic components industry data: ABF carrier board and memory prices continue to strengthen, and MLCC demand is weaker than seasonal (J.P. Morgan)
Based on May data from Japan's Ministry of Economy, Trade and Industry (METI), J.P.
Based on May data from Japan's Ministry of Economy, Trade and Industry (METI), J.P. Morgan pointed out that the output value and average selling price of rigid module substrates (including ABF) continued to rise, and the output and average price of memory increased significantly. The production data of MLCC, a star in the field of electronic components, was weaker than seasonal levels. The overall performance of the semiconductor sector, except for memory, was weaker than seasonal. The core of market concern may be AI-driven MLCC growth, but this data clearly reveals serious divisions within the industry: ABF substrates and memory are direct beneficiaries of AI demand, while MLCC, which accounts for half of electronic components, is experiencing seasonal weakness. One sentence conclusion: The electronic component industry is not monolithic. ABF carrier boards and memory are the "sons" of AI and are enjoying dividends, while traditional components such as MLCC may be experiencing a "frustrating moment" when the market is diverted by AI. Positive/negative: Positive for ABF carrier board suppliers such as Ibiden and Shin-Etsu Chemical, as well as memory manufacturers such as Samsung and Hynix. It is negative for suppliers whose short-term MLCC demand is lower than expected. A high boom in AI demand has been priced in, but the weakness of MLCC may be a negative that exceeds market expectations. Catalysts: 1) Monthly changes in inventory levels in the MLCC industry; 2) Whether major server and mobile phone OEMs will launch shipments in the second half of the year; 3) The results of quarterly contract price negotiations on memory prices.