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Microchip: ‘Shared Pains’ in the Wake of a Supercycle

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What’s at stake?

Microchip prides itself on being able to deftly wend its way through the semiconductor industry’s cycles by spreading the gains and the pains of each experience throughout the enterprise. The process is well tested and the long-term benefits to Microchip and its employees are numerous, company executives say. The current downcycle cuts deep, says CEO Ganesh Moorthy but the company is sticking with salary cuts and avoiding layoffs. Is the practice worth adopting? Moorthy takes our questions on Microchip’s distinct cycle management strategy and the turbulence of the electronics supply chain.

Microchip Inc. has been on a rollercoaster ride these last several years.

Between fiscal 2021 and 2023, the MCU chipmaker’s revenue soared more than 55 percent, fueled by torrid demand and supply shortages.

Now, in 2024, Microchip is on the downward slope. In the March quarter, revenues are forecast to slide 40 percent, year-over-year, and decline another 40 percent or more in June from the comparable 2023 quarter, eroding most of the gains the company has garnered over the previous years.

That should prompt drastic actions such as severe job cuts. This is how the industry typically responds to each of its sales crisis.

At Microchip, though, it’s the perfect time to trot out an old remedy, one the entire industry should watch closely, if not emulate.

ST’s Key to Unlock China: ‘Manufacturing’

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By Junko Yoshida

What’s at stake:
Before the U.S. CHIPS Act changed the formula worldwide, “manufacturing” was a millstone around every semiconductor company’s neck. STMicroelectronics is turning this burden into a bonus, pitching its manufacturing ability to differentiate from competitors. But, will it work?

STMicroelectronics is a solid, non-nonsense semiconductor company proud of having built its business brick by brick. Its acclaimed MCU product lines are supported by an unparalleled developer community.

For decades, the Franco-Italian company stuck with its integrated device manufacturing (IDM) model, even when manufacturing lost its cachet in the industry. That trend prompted many chip companies to go fabless or “fab lite” in the early 2000’s.

As an IDM, ST today does everything from R&D, process technology development and product design to running several fabs, manufacturing, testing, and packaging.

Uninterested in the market trend du jour, rooted in a long market view with disciplined operations, ST is flourishing. It ships “4,000 to 5,000 MCUs every minute,” said Remi El-Ouazzane, ST’s President of Microcontrollers, Digital ICs and RF products Group, in a wide-ranging interview with The Ojo-Yoshida Report.

Sameer Wasson’s Vision for MIPS/RISC-V

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By Junko Yoshida

What’s at stake:
MIPS, a storied CPU IP core company with a tortuous business/management history, is writing a new chapter under the watch of new CEO Sameer Wasson, formerly an executive at Texas Instruments. Can he lift MIPS from oblivion to relevance and solid growth? Wasson’s first order of business is to explain to the world who MIPS really is today.

Three months in, Wasson told The Ojo-Yoshida Report, “We just got started. We have a lot of work ahead of us.” The MIPS plan includes beefing up its work force from 62 when Wasson joined to “just under 100” by year’s end.

The Ojo-Yoshida Report picked up chatter this week that recent layoffs at SiFive have served as a source of talents for MIPS. We asked Wasson if some ex-SiFivers have migrated to MIPS. Wasson said, “We have hired some people who were let go. But we’re also hiring more people who are not let go.”

Olofsson’s Dream: A Plug & Play Chiplet

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By Junko Yoshida

What’s at stake:
With the whole industry struggling for consensus on a standard for chiplet interposers and bricks, a startup that has up and turned that trick is the definition of “disruption.” It’s anyone’s guess whether Zero ASIC will be richly rewarded for its insightful initiative or hammered down for being the nail that sticks out.

So far, chiplets have been an elusive vision, despite high hopes in the semiconductor industry.

As Devices Get Cloud Connected by Default, What Must MCUs Do?

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By Junko Yoshida

What’s at stake:

IoT used to be defined as the network of physical objects — “things” — embedded with sensors, software, and other technologies so they can connect over the Internet and exchange data with other devices and systems. But today, IoT is defined simply as: Getting data connected to the cloud. How, in this light, must MCUs change?

IoT encompasses myriad market segments and product categories. It covers consumer electronics, factory floors and infrastructure. It offers everything from doorbells, pet trackers and smart speakers to diabetes monitors, smart meters and smart cities.

All these IoT applications inevitably demand different types of wired/wireless network connectivity and protocols, while posing serious cybersecurity concerns. The IoT market, by definition, invites fragmentation and interoperability problems among products and applications, thus creating scaling problems for companies in the IoT space.

Handling the Baggage of Edge AI

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By Junko Yoshida

What’s at stake:
Everyone loves talking about Edge AI, but without mentioning the persistent gap between the AI and embedded worlds. Edge AI designers are caught in a never-ending cycle of ‘optimization’, pressed to fit neural network models and achieve acceptable accuracy on their hardware. They are desperate for tools to lighten their load. At stake is the scaling of edge AI deployment.

Edge AI today stands at “this uncomfortable junction,” said Evan Petridis, CEO at Eta Compute, in a recent interview with the Ojo-Yoshida Report. Edge AI straddles two domains – machine learning (ML) and embedded. These two distinctly different fields share neither the same language nor design philosophies.

Jim Keller at Intel (left) and Jim Keller at Tenstorrent

Jim Keller’s Journey from CPUs to CEO

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By Junko Yoshida

What’s at stake:
Although regarded as a “natural” in computer architecture, Jim Keller acknowledges he had to work hard to develop skills that enable him to lead thousands of engineers. How did he do it? What worked? What didn’t? Keller traces his evolution for us.

Practically everyone in the semiconductor world knows who Jim Keller is. The legendary CPU designer is revered throughout the engineering community.

That Severe Auto IC Shortage? It Will Happen Soon Again

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By Bolaji Ojo

What’s at stake?
The electronics supply chain is broken and needs a full course of treatment. But industry and governments worldwide are pouring resources mainly into ensuring the availability of leading-edge products. The auto IC supply chain is on the other end, though. That was where the disequilibrium started and where it was most noticeable. Not fixing it portents more trouble, says an industry executive.

Michael Hurlston is an engineer and not a physician. But he could easily be that health expert warning clients against not completing the full course of their immunization. The virus may mutate and become direly resistant to future treatments, Hurlston might say.

A semiconductor industry veteran and CEO at fabless chipmaker Synaptics Inc., Hurlston’s expertise diverges strongly from medicine. But after witnessing many of the semiconductor industry’s cyclical swings, Hurlston can identify the roots of the recent supply shortages that drove panic buying and crippled many automotive manufacturing plants over the last couple of years.

BYD's new energy vehicle, Yangwang U9, unveiled at Auto Shanghai 2023

China EV Inc. Preps for Global Market as Western Rivals Wilt

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By Junko Yoshida

What’s at stake:
Western automotive OEMs have been steadily retreating from a Chinese domestic market heavily dominated by local hybrid and battery electric vehicle manufacturers. Now, the Chinese auto OEMs are venturing out, poised to sweep into Europe, and then the rest of the world. How should lawmakers and carmakers in the U.S. and Europe respond to China EV Inc.?

a small company is ro be merged with a bigger company

Analysts: Onsemi Is Natural Candidate to Buy Wolfspeed

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By Junko Yoshida

What’s at stake:
Silicon-based power electronics devices and silicon carbide (SiC) power devices have commonalities. Suppliers of both types tend to be more vertically integrated. Where they diverge is their yields. SiC yield – from wafers to devices – is dramatically lower than silicon-based power devices. With everyone racing to nail down base manufacturing technology, the stakes center on how long Wolfspeed can keep competitors at bay.

To be clear, Wolfspeed is not for sale.

However, considering all factors affecting today’s silicon carbide (SiC) business, the industry experts tend toward the conclusion that On Semiconductor Corp. (Onsemi) is the most logical suitor to buy Wolfspeed. Here’s why.