PETALING JAYA: Some 44% of domestic semiconductor, electric and electronic (E&E) companies are optimistic about their investment outlook for the first quarter of 2025 (Q1’25), a survey conducted by the Malaysia Semiconductor Industry Association (MSIA) showed.
According to latest findings in the MSIA E&E/Semiconductor Quarterly Pulse Survey for the fourth quarter of 2024, these companies show slightly reduced investment optimism compared to earlier quarters, recording 52% in Q3’24 versus 58% in Q2’24.
As for business outlook, 44% of companies are optimistic about their performance in Q1’25, reflecting continued positive sentiment. However, this represents slightly lower optimism compared to previous quarters, with 53% in Q3’24 and 60% in Q2’24.
The survey indicated that for the 12 months in 2025, 66% of companies demonstrated optimism regarding the overall outlook, consistent with trends observed in previous quarters. There is uncertainty in the short term, but companies are more optimistic in the medium to long term, the survey showed.
MSIA’s ongoing survey aims to assess the sentiment, trends, challenges, and opportunities within Malaysia’s E&E/semiconductor industry every quarter.
In terms of business performance, 37% of companies reported improvement in Q4’24 compared to Q3’24. However, overall performance remained weaker than in previous quarters, with 46% in Q3’24 and 39% in Q2’24.
On hiring trends, 72% of companies are recruiting engineers and technicians in Q1’25, reflecting a continued positive hiring sentiment from previous quarters, the survey showed.
In terms of challenges and opportunities, the MSIA survey showed the semiconductor industry in Q4’24 continued to face talent shortages and market competition as primary hurdles, consistent with previous quarters. Supply chain disruptions and the escalating US-China chip war have also become more pronounced.
To overcome these challenges, companies are focusing on expanding into new markets, implementing cost-reduction initiatives, investing in new technologies, and increasing market share.
Touching on exploring US-China semiconductor policies and impacts, the MSIA survey noted that 57% of domestic companies see opportunities for Malaysia if there are continued escalation in the US-China chip war. It noted that Malaysia should diversify its semiconductor markets, its supply chain and focus on talent development to remain competitive and resilient if there are continued escalation in the US-China chip war.
MSIA president Datuk Seri Wong Siew Hai said 2024 marked a pivotal year for Malaysia with the launch of the National Semiconductor Strategy (NSS) in May 2024.
He added this strategic initiative underscores Malaysia’s commitment to staying ahead of global competition. It focuses on Malaysia’s capability and expertise in key areas such as IC design, semiconductor equipment, and advanced packaging.
“MSIA has been a proactive partner in supporting the NSS, exemplified by the establishment of the MSIA Advanced Technology Equipment Cluster, an industry-driven effort to enhance Malaysia’s technological edge.
“The survey results reveal that 2025 will present notable challenges for the Malaysian semiconductor industry, including talent shortages, market competition, and external geopolitical pressures.
“Despite these headwinds, the industry remains steadfast and prepared, leveraging innovation, collaboration, and strategic planning to turn challenges into opportunities and maintain its competitive edge,“ he said.
