Intel, Qualcomm Led a Declining Semiconductor Market in 2008

Worldwide semiconductor revenue fell by more than 5 percent in 2008—this is the finding of Gartner’s annual semiconductor market share analysis. Revenue for 2008 totaled $255 billion, down $14.5 billion from 2007’s total of $269.5 billion.
 
Intel led the industry, for the 17th consecutive year, with 13.3 percent market share, though it saw a revenue decline of 0.5 percent, to $33.8 billion.
 
No. 2 Samsung Electronics saw a decline of 15 percent, with 2008 revenues of $17.4 billion. And third-place Toshiba, with a 4.2 percent share of the market, experienced a 10.3 percent revenue decline to $10.6 billion in 2008.

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Peter Middleton, a principal analyst at Gartner, said in comments accompanying the release of the top-10 performing vendors, that sales held up well in the first half of 2008, but as the economy slowed in the third quarter the industry began to soften, and deteriorating sales in the fourth quarter pushed overall revenue numbers into negative territory.
 
“With the market heavily impacted by the recession,” Middleton wrote, “we can expect considerable market consolidation going forward.”
 
The best performing of the top-10 vendors was Qualcomm, which recorded 15.3 percent revenue growth, from $5.6 billion in 2007 to $6.5 billion in 2008, and boosted its ranking from No. 11 to No. 8.
 
Fifth-ranking STMicroelectronics (up from sixth place in 2007) also showed a positive revenue growth in 2008, of 3.1 percent, as did NEC, which rose from 12th place to 10th place and increased revenue by 3.2 percent.
 
Middleton attributes Intel’s 0.5 percent decline to the spinning off of its NOR flash business, which it did on March 31, creating a new company, Numonyx, with STMicroelectronics. Numonyx will create both NAND- and NOR-based products.
 
Gartner said the ongoing economic weakness signals worse declines in 2009—which so far has been a busy year for Intel.
 
Intel’s Nehalem microarchitecture has been enthusiastically embraced—though the right to create chip sets for Nehalem has also been the cause of lawsuits between Intel and Nvidia.
 
On April 8, Intel additionally drew closer to the MID (mobile Internet device) market, demonstrating its next-generation Atom-based MID platform, Moorestown, as well as introducing a Nehalem-EP based processor, code-named Jasper Forest, for the embedded market and storage applications space.