SIA: 2008 Semi Forecast Strong Despite Weak Memory Market PDF Print E-mail
Wednesday, 11 June 2008 06:42
SAN JOSE – The industry is at an interesting time in history because macroeconomics is struggling, yet the semiconductor market will continue to grow over the next three years, the president of the Semiconductor Industry Association said today. 
In its semiannual forecast, the trade group today lowered its 2008 outlook for overall IC growth to 3.9%, citing continuing woes for memory chips. 
Excluding memory gives a different picture however, said George Scalise. Non-memory ICs are expected to grow 7.4% this year. Memory products account for about 20% of total semiconductor sales, he said.
In November, the SIA projected total ICs would be up 7.6% in 2008, while non-memory chips would grow 9.4%.
The revised SIA forecast projects sales will reach $266.6 billion this year and $324.1 billion by 2011, a CAGR of 6.1%. The forecast projects sales will grow 6.2% to reach $283.2 billion in 2009, by 8.4% in 2010 to $307 billion.
In April, total semiconductor revenue was up 6% year-over-year, while ASPs were flat.

Year-to-date revenue is up 4.3%. However, semiconductors, less memory, are up 12.4% year-over-year. Year-to-date memory sales are down 17%, while microprocessors are up 15%. Overall, demand for traditional products, such as cellphones, is strong.
There is a good balance between supply and demand, Scalise said.
In 2008, semiconductor capital equipment spending will be 15% of semiconductor sales, according to the firm, down from previous years.
Cellphone units are expected to be up 12% this year to 1.3 billion units, on strong demand from emerging markets (Latin American, Asia-Pacific and Eastern Europe), said Scalise. PC shipments are expected to be up 10% to 300 million units, with Latin America and Eastern Europe growing as well. LCD-TVs are forecast to be up 29% to more than 100 million units, while digital still cameras will be up 11% to more 127 million units.
Scalise noted the price of DRAM and memory is a key factor in limiting revenue growth. “DRAM revenues declined by 34%, even as unit shipments increased by more than 30% in the first four months of 2008 compared to the same period last year,” he said. Memory makes up about one-fifth of total semiconductor sales.
He also said consumers are the largest demand drivers, with more than half of shipped products ending up in consumer hands.
Energy prices are not seen as having a visible impact on the market, Scalise said, noting that between 1978 and 2008, computer systems have become 3,000,000% more efficient.  


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