Should we care about the looming semiconductor downturn?

Micron sounding the alarm has added to fears that the chip boom may be coming to an end. Highlighting the speed at which markets appear to be cooling, the memory maker warned Tuesday that orders had deteriorated compared even to the company update provided only five weeks ago. “Compared to our last earnings call, we see further weakening in demand because of adjustments broadening outside of just consumers to other parts of the market including data centers, industrial and automotive,” CEO Sanjay Mehrotra said in an interview with Bloomberg Television.

Slowing demand in consumer end-markets, most importantly PCs and smartphones, had previously been noted. Last month, TSMC spoke of “softening momentum” in PC, smartphone and other consumer end-markets. ASML, too, saw a slowdown in these segments. Unlike Micron, however, neither company saw worrying signs in data center, automotive and industrial markets. The demand there “is still very, very strong,” ASML CEO Peter Wennink said in July. Nevertheless, investors are rattled by Micron’s comments, which follow disappointing quarterly results from Intel and Nvidia.