Because of Christmas, New Year’s, and the introduction of new products, manufacturer demand for electronics components typically peaks in the second half of the year. However, new data from Commodity IQ, Supplyframe’s decision support platform, shows that electronics demand was anything but normal in 2025. Pre-tariff frontloading earlier in the year caused a demand spike, which was followed by a rapid mid-year decline and anticipated record lows in November and December.
The demand for semiconductors, interconnects, and passives (excluding AI GPUs) peaked in May 2025, fell sharply in June, experienced a modest surge in July, and has been declining or remaining flat ever since. Interconnects fell by 7.9% in Q3, semiconductors by 9.7%, and passives by 8.2%. According to Commodity IQ, December will see all three commodity categories reach four-year lows.
Lead times and pricing were impacted by these significant changes in stock and demand.
Due to decreasing demand in the second half of 2025, lead times normalized after peaking in May. Lead times will continue to decrease in Q4, according to Commodity IQ intelligence, with passives and semiconductors falling 13.4% and 5.3%, respectively, and interconnects falling 2.8%.
These components’ prices have been either steady or declining, with the biggest shifts taking place between April and August. In Q4, pricing for semiconductors, passives, and interconnects is anticipated to either be relatively unchanged or decline. However, costs may be impacted if the U.S. presidential administration proceeds with placing duties on chip imports.
In addition to 1,000 practitioner, partner, and source contributions, Supplyframe Commodity IQ represents actual demand, design activity, inventory, lead times, and pricing across over $150 billion in yearly commodity spend across Supplyframe’s global Design-to-Source Intelligence (DSI) Network of over 12 million sourcing and engineering professionals.
Commodity managers can manage uncertainty and cut expenses with the help of this real-time decision support.
Leadership Comments
“This new Commodity IQ data provides further proof that our unpredictable world is turning typically reliable trends on their heads,” said Supplyframe CEO and founder Steve Flagg. “It follows our earlier 2025 finding that electronics supply chain disruption due to the new tariff regime and related behaviors even outpaced what we all experienced during the pandemic.”
“No one can predict the future,” said Flagg. “But if you can understand emerging trends early and make the right tradeoffs during new product design, you will significantly lower your risk related to outside forces that can lead to changes in demand, inventory, lead time, and pricing. Supplyframe’s Design-to-Source Intelligence solutions provide the outside-in intelligence that today’s industry leaders need to thrive in an uncertain market.”
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