News
ST. PETERSBURG, FL – Jabil Circuit today reported flat fiscal first-quarter revenues of $3.4 billion, while preliminary GAAP operating income plunged 21% from last year to $77.7 million.
SAN JOSE – Slowing demand for PCs and cellphones will stall the semiconductor industry recovery, a group of analysts predicted during SIA’s 2009 forecast Thursday.
The group of prognosticators asserted 2009 sales will be bleak relative to historical standards, with consolidation possible on the equipment side.
Among the bears was VLSI Research senior economist Aida Jebens, who forecasts a 6.9% drop in IC sales next year. “Growth will be flat, if not negative. Moreover, pricing pressure will flatten revenues even if unit shipments grow, she said.
VLSI’s price index shows ICs in “ really bad shape,” Jebens said.
Advanced Forecasting CEO Moshe Handelsman says worldwide IC revenues fell 2% in 2008, and predicts a larger decline for 2009.
Dale Ford, senior vice president, marketing intelligence at iSuppli Corp., says shipments will be down 4 to 5% for 2008 and will worsen next year. This deep decline should turn around in late 2009 to early 2010, he says, then rebound in 2010.
Calling 2009 a “year of austerity,” Infrastructure director of research Carl Johnson sees “unheard of declines” for components for PCs, which could be down 50% during the first half.
The analysts agreed inventories could become a problem in the coming year as OEMs pull back orders.
Slowing End Demand
Most see slowing demand for electronics. VLSI predicts an overall drop of 2.6% year-over-year in 2009, with PC shipments growing 3 to 5%, but negative growth for cellphones.
SEMI, meanwhile, says the notoriously cyclical semiconductor equipment market will fall 21% in 2009, following 2008’s 28% year-over-year drop.
Bookings and sales could fall to 2003-03 levels, pegging the overall capital spending at $22 billion. Equipment represents 12% of device revenue, “an all-time low,” says Lara Chamness, senior market analyst, industry research and statistics.
IC and related manufacturing equipment will be down 24.7%, VLSI predicts. iSuppli’s Ford thinks PCs will show modest growth, while flat-screen LCDs will be flat.
The overall economy will grow, but sluggishly. Ford projects GDP growth of 2.2% in 2009, noting some foresee a decline.
Infrastructure’s Johnson predicts a “big shakeout” in the industry. “It will be survival of the fittest. The longevity of the business model is really important right now.”
Whether governments will intercede remains unknown, but is a potentially huge factor. “At some point for the semiconductor industry, the government will take on a role, but that role is a significant unknown right now,” says Ford. “And it won’t be the same role globally. We will deal with trade issues and run the risk of trade wars.”
“Wall Street will not be the solution,” he added. “That door has closed.”
But they agreed that with much of the foundry work now in Asia, the pressure will be on foreign governments, particularly in Asia, to make decisions on bailouts.
Semiconductors have a future in photovoltaics, one area that has seen outside investment, but that sector too will be tied to government subsidies. As Ford says, “As energy prices come down, there will be less willingness to invest in alternative energy solutions.” Johnson agrees, stating photovoltaics would be a longer-term play. “The reality is we’re sitting on the solar business; the tree will shake, and the semiconductor business has a role to play in this.”
FORT COLLINS, CO – EMS firm RPM Electronics will shutdown by the end of February, putting 70 employees out of work, according to published reports.
The firm, founded in 2001 as RPM Technology, had recently lost business from two big customers – Advanced Energy Industries and Plasmon – which made up about half of RPM's sales.
Since March, RPM has been owned by RAD Electronics.
TOKYO – Panasonic Corp. shareholders have agreed to offer $9 billion for Sanyo, a deal that could make way for one of the world’s largest electronics firms. Investment bank Goldman Sachs, a major Panasonic shareholder, has agreed the to plan, according to reports. Sanyo would become a Panasonic subsidiary under the deal, which is expected to be completed by February.
Panasonic, which until recently operated under the name Matsushita, is the world’s fourth largest maker of electronics and electrical equipment, while Sanyo ranks 15th. The combined company would have combined revenues of about $113 billion, ranking second, behind Siemens.
Panasonic, which until recently operated under the name Matsushita, is the world’s fourth largest maker of electronics and electrical equipment, while Sanyo ranks 15th. The combined company would have combined revenues of about $113 billion, ranking second, behind Siemens.
Sanyo’s profits dropped about 67% to $49 million in the September quarter. Panasonic's profit for the quarter fell 16% to $624 million.
STOCKHOLM – EMS provider NOTE has acquired all shares in Oslo-based
electronics manufacturer Norteam Electronics AS, the company said. Financial details were not disclosed.
MEMPHIS -- Flextronics last night informed a local development board of its plans to invest $2 million in new and expanded electronics repair operations here.
The EMS company told the Memphis and Shelby County Industrial Development Board of plans to open a new facility a few blocks from its current site, on Holmes Rd. Furthermore, Flextronics will expand its existing site, the Memphis Business Journal reported.
Flextronics has earmarked $2 million for the projects, and add a reported 151 new jobs.
The EMS company told the Memphis and Shelby County Industrial Development Board of plans to open a new facility a few blocks from its current site, on Holmes Rd. Furthermore, Flextronics will expand its existing site, the Memphis Business Journal reported.
Flextronics has earmarked $2 million for the projects, and add a reported 151 new jobs.
MOUNTAIN VIEW, CA – A just-released survey of some 85 senior-level executives at semiconductor companies finds a majority sees R&D and capital expenditures decreasing significantly next year.
As economic conditions and consumer spending continue to deteriorate, semiconductor executives are turning more pessimistic, and anticipate a steep decline in profitability during the next 12 to 18 months, says the consulting group that conducted the survey.
SAN JOSE – The MicroElectronics Packaging and Test Engineering Council in February will sponsor a symposium on semiconductor packaging’s effect on consumer electronics.
The technical event will address packages for consumer products, with session topics including time-to-market and consumer semiconductor packaging; cost-of-ownership challenges for consumer products; solutions for consumer product miniaturization, and advancing technologies for consumer electronics.
It takes place Feb. 19 in San Jose. For more information, visit www.meptec.org.
The technical event will address packages for consumer products, with session topics including time-to-market and consumer semiconductor packaging; cost-of-ownership challenges for consumer products; solutions for consumer product miniaturization, and advancing technologies for consumer electronics.
It takes place Feb. 19 in San Jose. For more information, visit www.meptec.org.
ST. PETERSBURG – The economy could sink not just Jabil's near-term growth, but also more than $30 million in tax rebates and other incentives tied to the EMS company’s new headquarters here.
Under a controversial deal agreed on earlier this year, Jabil must begin construction on a new, $50-million headquarters within a year and add about 860 jobs by 2012, according to reports. The company must also keep local employment above 1,800; it currently employs 1,872.
Under a controversial deal agreed on earlier this year, Jabil must begin construction on a new, $50-million headquarters within a year and add about 860 jobs by 2012, according to reports. The company must also keep local employment above 1,800; it currently employs 1,872.
MANASSAS, VA – Zestron has expanded its team with the addition of Alexander Koegel as junior product manager.
Koegel primarily will be responsible for products related to surface cleanliness and bath analysis, and will support activities related to the German press and the company’s services.
Started in 1975, Zestron has global technical centers in the US, Europe and Asia.
Koegel primarily will be responsible for products related to surface cleanliness and bath analysis, and will support activities related to the German press and the company’s services.
Started in 1975, Zestron has global technical centers in the US, Europe and Asia.
EL SEGUNDO, CA – The deck appears stacked against the global semiconductor industry, with six separate market forces conspiring to cause revenue to decline by nearly a double-digit margin in 2009, says iSuppli Corp.
The research group became the latest to lower its 2009 worldwide semiconductor industry revenue forecast, estimating a 9.4% drop year-over-year to $241.5 billion. iSuppli previously predicted 6.8% growth.
The research group became the latest to lower its 2009 worldwide semiconductor industry revenue forecast, estimating a 9.4% drop year-over-year to $241.5 billion. iSuppli previously predicted 6.8% growth.
SAN DIEGO – KIC, a provider of thermal process and control products, will move into a larger facility in San Diego next month.
KIC has been expanding its product range of thermal process tools. The company also recently entered the solar cell manufacturing industry.
“Our new facility is larger and provides a layout that is more suitable for our needs in production as well as R&D,” says David Nason, operations manager at KIC.
KIC’s headquarters will house the majority of the company’s production and R&D, as well as administrative services. To be central to its customer base, however, KIC also has built up R&D, sales and customer support centers during the past several years in Europe, China (three separate facilities) and Singapore, in addition to its R&D facility in Oregon.
KIC has been expanding its product range of thermal process tools. The company also recently entered the solar cell manufacturing industry.
“Our new facility is larger and provides a layout that is more suitable for our needs in production as well as R&D,” says David Nason, operations manager at KIC.
KIC’s headquarters will house the majority of the company’s production and R&D, as well as administrative services. To be central to its customer base, however, KIC also has built up R&D, sales and customer support centers during the past several years in Europe, China (three separate facilities) and Singapore, in addition to its R&D facility in Oregon.
