Motherboard makers have begun slashing chipset orders due to weakening demand in China and the European bond crisis, according to sources from motherboard makers.

Since motherboard sales were disappointing in April and May, motherboard companies will focus on digesting inventory in June and July, and are unlikely to place a large amount of new orders for the third quarter, the sources noted.

Motherboard makers have also recently adjusted their second quarter shipment forecasts to drop 15-20% on quarter.

As motherboard makers are reducing their chipset orders, Intel's chipset shipments in the third quarter are expected to see a sequential decline, the sources added.