ON and US-Taiwan routes have recently become tight again.

01

It’s become in short supply again recently—what’s going on?

The onset of this round of supply tightness can be traced back to late October last year.

To start with the original trigger. On September 30 last year, the Dutch government issued a ministerial order targeting Nexperia. In early October, the Dutch Enterprise Court ruled to suspend Zhang Xuezheng from his position. During this period, China’s Ministry of Commerce rolled out export‑restriction measures, yet granted exemptions for eligible exports in November. Meanwhile, Nexperia in the Netherlands unilaterally halted wafer supplies to its Dongguan packaging and testing plant, putting the supply of Nexperia chips under the market spotlight.

In early October 2025, certain Nexperia chips experienced panic buying, stock hoarding and suspended quotations. Feedback from distributors at that time indicated that several major domestic global Tier‑1 manufacturers had already begun material migration away from Nexperia, placing bulk orders with onsemi. In addition, multiple traders reported receiving numerous inquiries from large trading houses for Nexperia alternative components, generating strong substitution demand for parts from onsemi, TI, VISHAY and Diodes.

In November 2025, Quiksol and other domestic semiconductor spot dealers noted in public reports that due to regulatory impacts on Nexperia, lead‑time and price volatility intensified for onsemi power devices. Prices of selected power components were affected, with lead times showing an upward trend.

In the months that followed, substitution demand for Nexperia components remained robust. Among alternative suppliers, onsemi saw the strongest market interest and highest substitution volume. Prices for MOSFETs, transistors and selected PMIC devices climbed, with lead‑times stretching to an average of 18‑40 weeks, and some parts exceeding 40 weeks.

Price increases began to take effect in 2026. In March, both onsemi and Diodes issued price‑increase notices, effective April 1. Both cited rising demand and higher raw‑material costs as reasons for the hikes. Industry contacts specializing in Diodes products noted at the time that even in‑transit orders were subject to price adjustments alongside extended lead‑times, with certain orders scheduled for delivery as late as year‑end. Lead‑times for onsemi parts kept lengthening, and by May, lead‑times for some onsemi components had hit 52 weeks.

In June, onsemi released its second price‑increase letter, taking effect on July 11, covering a broader range of product lines.

During this period, chip traders also reported having placed orders but still waiting indefinitely for delivery. "We've placed the order, but the lead time is extremely long." By that point, Diodes components had become highly sought-after in the market.

This renewed rally for onsemi and Diodes got underway in July. However, the chips driving the rally differ from previous waves — the components seeing sharp price spikes are predominantly niche, less common parts, with demand driven mainly by overseas buyers. Some in the channel also noted that many of the out-of-stock items are transistor-type products.

That said, not all part numbers from these two brands are seeing the heat; there is clear divergence across their portfolios.

A chip export salesperson noted that the overseas end-customers they've been in touch with recently are all asking for Diodes parts that are barely available in the market. The tipping point for the rally was roughly the late-July rumor that Diodes had quoted 62-week lead times.

Some distributors commented: “For Diodes parts ordered by our customers, prices have been rising and lead‑times extending since the start of the year. We closed a deal in early August and checked stock availability prior to payment, only to find the stock had already been sold out, with no replacements available across the market.”

Other market participants shared that they held certain onsemi and Diodes parts but paid little attention to them, only to see them all snapped up in July and August.

This observation was corroborated by an industry contact focused on Diodes procurement. According to him, among recent incoming orders, genuine firm orders cannot be fulfilled due to stock shortages, while parts that are in stock receive little buyer interest.

Price hikes for onsemi and Diodes kicked off at roughly the same time. Traders dealing in onsemi spot inventory noticed price increases starting in July, though rises varied across product lines — some items went up in price while others remained largely unchanged.

A salesperson focusing on onsemi spot business said their portfolio targets primarily the domestic consumer market with standard commodity components, serving both the open market and end‑customers. From a spot‑trading perspective, business performance can be directly gauged by order volumes. During the Nexperia‑driven supply crunch, onsemi saw a notable surge in orders. Business remained solid in the first half of the year, yet turned relatively slow from July through September.

Specifically, Quiksol’s July data indicated that roughly 80% of standard product lines enjoyed sufficient supply. Supply tightness was concentrated on automotive‑grade and high‑power devices, among which SiC MOSFETs faced the most severe shortage with lead‑times ranging from 26 to 40 weeks. Certain IGBT module part numbers remained subject to allocation quotas.

Data from L&C Jie over July‑August corroborated this trend. For onsemi, lead‑times for diodes, triodes and MOSFETs have extended to 28‑52 weeks or longer. Prices for SiC series rose by over 15%, while medium‑ and high‑voltage MOSFETs carry lead‑times exceeding 45 weeks. As for Diodes, lead‑times for general‑purpose diodes stayed at 28‑40 weeks, yet automotive‑grade and high‑voltage MOSFETs also stretched beyond 45 weeks. One distributor serving Diodes’ industrial‑market customers commented that Diodes has been in high demand since last November. Allocation is now in place with no definitive lead‑times provided.

Overall, this market cycle has persisted since late October of last year. Substitution demand stemming from Nexperia once tightened supply for mainstream components including MOSFETs, transistors and PMICs, accompanied by price increases. Lead‑times for some products extended past 40 weeks and even hit 52 weeks. In recent months, tight‑supply part numbers have spread to niche and less‑popular components, with demand mainly driven by overseas markets.

02 Extended Lead Times and a Booming Market:

What Does This Mean for Nexperia?

Since late October last year, both suppliers have witnessed significant fluctuations in lead‑times and prices, which have persisted to date. It is evident that the market rally for Diodes and onsemi is linked to the Nexperia incident.

Nevertheless, beyond the dividend brought by Nexperia‑driven substitution demand, the current market upswing is also heavily tied to the two manufacturers’ organic business growth, capacity constraints, extended lead‑times, price‑increase notices, as well as the widely‑circulated screenshot mentioning “Diodes 62‑week lead time” referenced above. We seek to analyze the situation based on manufacturers’ financial reports, official statements and Nexperia’s supply status.

Nexperia’s far‑reaching impact stems from its market scale. According to Wingtech’s 2024 annual report, the company offers nearly 16,000 part numbers. It ranks No.1 globally in shipments of small‑signal diodes and transistors, ESD protection devices and small‑signal MOSFETs, and takes second place worldwide for logic ICs and automotive‑grade power MOSFETs. Its Dongguan packaging and testing plant, cut off from wafer supplies, is the world’s largest manufacturing site for small‑signal components with an annual output exceeding 50 billion units.

S&P Global stated at the time that Nexperia held approximately 5% of the global automotive silicon discrete‑device market, with a slightly higher share in Europe. Its market share is even larger when measured by chip unit volume. Real reliance on Nexperia chips exists within the automotive sector, yet the overall landscape remains complex.

While Nexperia mainly sells standard devices for the automotive sector, theoretically the affected products can be readily swapped among qualified suppliers. Alternatives are available from Infineon, onsemi, ROHM, Renesas, ST and other vendors. Nevertheless, re‑qualification, procurement coordination and functional‑safety validation can take considerable time.

In the spot market, chip traders reported strong substitution demand for components from onsemi, TI, VISHAY, Diodes and ROHM, with onsemi seeing the highest demand among them.

Both Diodes and onsemi, which benefited from this wave of substitution, later offered respective comments in their financial earnings materials.

During its Q4‑2025 earnings call, Diodes referenced “recent supply disruptions in the market”. It stated that the company was strategically supporting new opportunities and orders from key customers, especially within automotive and communication markets.

At the Q2‑2026 earnings call, Diodes further noted that “the supply disruptions discussed in prior calls are still ongoing”. To cope with extended wafer lead‑times, the company had proactively built up its inventory.

Onsemi took a far more restrained stance. During its Q3‑2025 earnings call, when asked about the impact of the Nexperia incident, the CEO merely commented, “The impact is significant, yet it is too early to draw conclusions.” He also remarked, “Any supply‑chain disruption, whether involving Nexperia or another player, will trigger ripple effects.” In subsequent quarters when discussing lead‑times and price increases, onsemi never singled out Nexperia.

Their financial reports reveal a simultaneous uptick in business performance, capacity utilization and lead‑times for both suppliers.

Onsemi’s overall revenue declined in 2025, registering full‑year revenue of USD 5.995 billion, a 15.3% year‑on‑year drop. Quarterly revenues from Q1‑2025 to Q2‑2026 stood at USD 1.446 billion, 1.469 billion, 1.551 billion, 1.530 billion, 1.513 billion and 1.604 billion respectively. Its latest quarter delivered 9% year‑on‑year growth, with non‑GAAP gross margin recovering to 39.3%.

Growth was primarily driven by the Power Solutions Group (PSG), whose revenue rose from USD 645 million in Q1‑2025 to USD 829 million in Q2‑2026, accounting for approximately 52 % of total revenue. In Q2‑2026, PSG posted 19 % year‑on‑year growth. The Analog and Mixed‑Signal Group (AMG) contributed around 34 % with a 2 % year‑on‑year decline, while the Intelligent Sensing Group (ISG) made up roughly 14 % and delivered 7 % year‑on‑year growth.

Per onsemi’s annual‑report segmentation, PSG covers six product categories: Silicon Carbide (SiC), SiC JFETs, discrete devices, MOSFETs, power modules and vertical GaN. The division represented 47 % of total revenue in 2025, making it the company’s largest business segment.

By end‑market, AI data centers constituted the fastest‑growing segment. In the quarter in question, onsemi’s “Other” category generated USD 400 million in revenue, up 34 % quarter‑on‑quarter, mainly driven by AI data‑center demand. Over the same period, automotive revenue fell 2 % quarter‑on‑quarter and industrial revenue rose 1 % quarter‑on‑quarter. Onsemi expects AI data‑center‑related revenue to double in 2026.

Diodes recorded full‑year 2025 revenue of USD 1.482 billion, a 13 % year‑on‑year increase. Quarterly revenues from Q1‑2025 through Q2‑2026 were USD 332 million, 366 million, 392 million, 392 million, 406 million and 446 million respectively. Its latest quarter achieved 21.66 % year‑on‑year growth with gross margin climbing to 33.1 %.

In terms of end‑market segments, the automotive business showed the most notable shift. For full‑year 2025, the market breakdown was: Computing 27 %, Industrial 23 %, Automotive 19 %, Consumer 18 %, and Communications 13 %. By Q2‑2026, the automotive business hit a record high, rising to 21 % of total revenue. It grew 15 % quarter‑on‑quarter and 37 % year‑on‑year, which the company attributed to expanding market share in ADAS and electrification.

On capacity and lead‑times, onsemi stated on its latest earnings call that lead‑times had extended from around 27 weeks to 32 weeks. Supply tightened across several growth‑driven segments. Meanwhile, the company observed an increase in orders placed within quoted lead‑times and more customer expediting requests, which onsemi viewed as a sign of healthy demand. The book‑to‑bill ratio continued to improve. Capacity utilization climbed from 77 % in Q1 to 83 %, and is projected to stay flat or edge higher in Q3.

Notably, onsemi prioritized shipments to AI data‑center customers in Q2, ahead of automotive and industrial customers. According to onsemi, this was triggered by accelerating demand from AI data centers. Normal allocation is expected to resume once supply‑demand balance is restored.

Similar observations can also be heard from the spot market. Some traders pointed out that parts from onsemi and Diodes previously yielded low profit margins for the manufacturers, yet most production capacity is now diverted toward high‑margin AI‑related components.

Diodes did not disclose specific lead‑time figures. It only mentioned during its Q2 earnings call that wafer delivery cycles had lengthened, for which the company built up additional inventory. Inventory value reached USD 504.6 million at the end of Q2, representing a quarter‑on‑quarter increase of USD 11.8 million. Meanwhile, channel inventory kept declining and fell below the normal range of 11‑14 weeks of coverage.

Future Electronics’ latest lead‑time sheet also shows lead‑times of 24‑52 weeks for onsemi’s diodes, transistors and MOSFETs, and 35‑52 weeks for equivalent Diodes parts. Both manufacturers are marked with upward trends for lead‑times and pricing across these product categories.

On the other hand, supply from Nexperia China is also on the mend. During its June shareholders’ meeting, Wingtech stated that its three major product lines are targeted to recover to 80 % of their original global capacity by the end of 2026. Data released in August showed that more than 40 billion chips had been delivered to thousands of customers worldwide over the prior 11‑month period. Delivery cycles for automotive‑grade chips were shortened from 12‑16 weeks down to 4‑6 weeks.

Nevertheless, capacity recovery does not equate to market recovery. Wingtech’s 2026 interim report recorded operating revenue of RMB 1.514 billion for the first half of the year, a year‑on‑year drop of 94.02 %. Net profit attributable to parent shareholders stood at ‑RMB 406 million, falling 185.74 % year‑on‑year. Tu Zhengfeng, Secretary of the Board, disclosed at the shareholders’ meeting that numerous customers, including several overseas accounts, had renewed supply contracts with Nexperia China between Q4‑2025 and Q1‑2026. Even so, overall shipment volumes remain substantially below historical levels.

03

Concluding Remarks

At present, Diodes and onsemi remain hot commodities in the semiconductor spot market, with prices climbing, driven largely by demand for certain niche part numbers. Original‑manufacturer lead‑times keep expanding, and manufacturers hold relatively optimistic outlooks for future demand. Nexperia’s supply is gradually recovering, while competition for mature‑process manufacturing capacity fueled by AI persists. Where this market cycle will head remains to be seen.