Worldwide Semiconducter Sales To Decline in 2009, Report Says
According to a report from
information technology research company Gartner, worldwide semiconductor
revenue is on track to total $212 billion in 2009, a 17.1 percent decline from
2008 revenue of $255 billion. The firm said the forecast was better than the
second quarter projections when Gartner projected semiconductor revenue to
decline 22.4 percent this year. While the outlook for 2009 has improved,
Gartner analysts pointed out that all major segments of the semiconductor
market are expected to experience double-digital declines in revenue in 2009.
Bryan Lewis, research vice
president at Gartner, said consumers reacted strongly to reduced PC and LCD TV
pricing, as price elasticity was remarkable. "The semiconductor market has
performed better than expected, as was evident when second quarter
semiconductor revenue increased 17 percent in sequential sales," he said. "The
industry also benefited from the China stimulus package that worked remarkably
well to boost short-term demand. Governments worldwide took action quickly and
extensively to avoid a meltdown, and it worked."
Gartner reported some of the
leading semiconductor vendors revealed positive second quarter sequential
revenue growth, which the company said bodes well for the PC and cell phone
segments. Intel posted 12 percent sequential revenue growth, while Samsung, the
second largest semiconductor vendor based on 2008 revenue, posted a 30 percent
increase sequentially in chip sales driven by firming memory prices, exchange
rates, and a rebound in PC production. Qualcomm, the number eight-ranked
semiconductor vendor last year, reported that its cell phone chip sales
increased 35.7 percent sequentially.
The largest segment of the
semiconductor market, application-specific standard product (ASSP), will reach
$57.2 billion in 2009, but it represents a 16.5 percent decline from 2008
revenue, Gartner reported. The memory market, the number two segment, is
forecast to total $41 billion, a 13.5 percent decline from last year. The
microcomponents segment (microprocessors, micro controller units, digital
signal processors) is on pace to reach $39.4 billion in 2009, a 19.2 percent
decline from 2008.
While Gartner said the
industry did see some better than expected results in the second quarter of
2009, they question whether this optimism can be sustained through 2010.
Gartner's latest outlook for 2010 is worldwide semiconductor revenue to total
$233 billion, a 10.3 percent increase from 2009 projections. Lewis noted the fourth
quarter of 2009 and first quarter 2010 would be "extremely important" in
shaping the annual growth for 2010.
"We are currently expecting the fourth quarter of 2009 to be slightly positive, in line with typical seasonal patterns, but foundries have reported they are concerned that demand may drop off more than seasonal in the fourth quarter, and it may carry into first quarter 2010," he said. "Gartner -s most likely scenario is calling for a negative 5 percent growth in the first quarter of 2010 as customers take a pause and absorb all the devices they purchased over the previous three quarters."