GigaDevice shipped about 200 million MCUs in 2020: The reasons for the surge in MCU market demand are revealed

On March 17, according to recent investor survey information released by GigaDevice, the company's MCU shipments in 2020 were close to 200 million. At the same time, the company also analyzed the reasons behind the surge in MCU market demand! On the same day, GigaDevice's stock price rose by 8.59%.

According to GigaDevice, the company's MCU department was established for exactly ten years this year. The MCU products began to be promoted in the market in 2013, and have been in the market for almost eight years. Making general-purpose MCUs requires a long accumulation process. After eight years of marketing and R&D efforts, the product line layout is now relatively complete. It is currently in an absolute leading position in the domestic 32-bit MCU market, and the brand is also recognized by domestic and international customers.

He emphasized: "In the past 2020, the growth rate of MCU was very large. In 2020, the number of MCU shipments was basically close to 200 million. With the impact of geopolitical relations and the epidemic, the demand for domestic substitution of the company's products also basically began to unfold in 2020."

GigaDevice pointed out that as a main chip, the speed of replacement is not that fast. It takes a long time for an MCU to go from a product project to a customer application product project to verification, small-batch production, and then to large-scale production. In the second half of 2020, the company's MCU products have been gradually mass-produced in many large company projects in the early stage, from small-scale production to formal mass production. It can be seen that the demand is a very large growth, which will continue until the first quarter of 2021.

He also said: "At present, the shortage of mainstream MCU suppliers in the international market is also very serious. Now many large foreign manufacturers are also importing the company's MCU, so we believe that there will be a greater improvement in 2021 compared to 2020. At present, we see that the growth of the entire MCU will continue for a considerable period of time."

It is reported that with the changes in the overall environment, including changes in the upstream supply chain and the needs of downstream customers, the prices of many MCUs have increased several times in the market, especially in the trade market in Huaqiangbei. We also saw two days ago that the original price of automotive MCU in China was US$5, but now the market price has been driven up to RMB 500.

GigaDevice said that due to the increase in costs, some traders in the market are speculating on the products. In fact, they get the products from the company at a low price and speculate on them in the market. In order to control the chaos in the market, the company adjusted the price of MCU in the first quarter of 2021. Of course, as the market changes, the company will continue to adjust prices, but the company still hopes to protect downstream customers to the greatest extent possible. At least at this point in time, the entire electronic product production chain is in great difficulty. Now the company is being chased by customers for products every day. The company also hopes to work with colleagues in the entire upstream and downstream industry chain to overcome the difficulties together.

As for the reasons for the current substantial increase in demand for MCUs, GigaDevice explained that there are two main reasons. On the one hand, it is indeed because the entire epidemic has changed people’s consumption habits, so we can see that the demand for various home electronic products has increased a lot.

On the other hand, under the overall trend of domestic substitution, domestic substitution in the field of industrial control was relatively conservative, but now everyone is very proactive in doing domestic substitution, which is also a very important factor for the company to be relatively optimistic about the future. In the field of industrial control, there is a very large market, and this part used to mainly use foreign MCUs. At present, the quality, stability and brand awareness of the company's MCU products are very recognized by customers.