iSuppli Trims 2008 Semiconductor Forecast

The research group says concerns about the U.S. economy will reduce market revenues in the first half of 2008.

While the global semiconductor market is expected to grow in 2008, concerns about the U.S. economy—especially the sub-prime mortgage crisis—is leading market research company iSuppli to reduce its revenue forecast for next year.

In a Dec. 20 report, iSuppli now reports that worldwide semiconductor revenue will grow 7.5 percent in 2008, to $291.4 billion. In September, the company had called for a revenue increase of 9.3 percent.

If the semiconductor market slows, then iSuppli predicted that the sales of a wide range of hardware, including desktops, laptops and handheld devices, could also lag in 2008. For most of 2007, PC revenue increased thanks to both enterprise buyers and consumers buying notebooks in record numbers and a renewed interest in lower-priced desktops.

Originally, iSuppli found the hardware market would increase 7 percent in 2008, but the company is now calling for a jump of 6.6. percent as it expects both IT and consumers to reduce their spending in the new year.


Will AMD's woes continue into 2008? Click here to find out.

Despite dialing down its forecast, iSuppli researchers found the semiconductor market continues to grow. In 2007, the market is expected to reach revenues of $270.9 billion, an increase of 4.1 percent from the $260.2 billion in revenue the market saw in 2006. In addition, the report indicated that the market could rebound in the second half of 2008.


The global chip market is expected to take a big hit in the first half of 2008, with revenues declining to $135.9 billion, a decrease of 4.5 percent compared with the second half of 2007. In November, iSuppli predicted that Intel will increase its global share of chip revenue by the end of 2007 to 12.5 percent.

The memory market, including DRAM (dynamic RAM) and NAND flash memory, is also expected to decline in the first half of 2008 before picking up in the second half.


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