You can never have too much VC. All these companies are hiring scientists and engineers which will then get practical experience and become high-quality personnel.More like oversaturated. There is no way that so many startups will survive. The industry is bound for consolidation.
So many companies want to make MCU but can they really compete against gigadevice . Many image sensor , isp , display drivers but there is no way that they can complete with omnivision or hisilicon. AI chip is another fad. And in compound semiconductor will they be able to complete against sanan or byd semiconductor. They VCs will get burned.
Give it 3-5 years and after some consolidation and there would be a tremendous number of qualified and experienced people to drive forward the industry