During 2024 China,14,648 chip development and production companies folded into their activities. For comparison, a year earlier, 10,080 such enterprises closed, and in 2022 - 6232. The corresponding data in mid-January 2025 was disclosed by Wind Information.
As Digitimes notes, the wave of bankruptcies of Chinese chip companies is caused by a boom in investment in the semiconductor industry in 2021-2022. Analysts cite several factors contributing to the closure of enterprises in this area: these are, in particular, fierce internal competition, problems in supply chains, etc. China's investment in semiconductor projects declined 22% year-on-year in 2023, according to CINNO Research.
In 2021-2022, the salaries of Chinese specialists in the field of research and development of chips increased 1-2 times, while in key positions there was a sixfold increase. Capital-fueled startups have aggressively poached engineers from leading chip development firms and multinationals, offering substantially higher salaries. The shortage of personnel allowed people without significant chip design experience to enter this sphere.
However, a slowdown in the semiconductor market in 2023 ended the hiring frenzy of previous years. Proposals to double salaries have disappeared, and there has been a trend of funding cuts in the semiconductor market. Overall, a sharp rise was followed by a rapid decline. As a result, the number of closures of chip development and manufacturing companies began to increase rapidly. In particular, Oppo was forced to curtail the activities of its chip development subsidiary Zeku, citing "uncertainty in the global economy."
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