EL SEGUNDO, CA – iSuppli Corp. today issued a revised outlook for semiconductor sales, forecasting 6% growth. The research firm previously forecast an 8.1% increase.

Still, iSuppli’s outlook is more optimistic than that of many researchers, as the industry average is closer to 2 to 3%.

Based on the iSuppli figures, global semiconductor revenue will rise to $276.6 billion, from $260.9 billion in 2006.

iSuppli trimmed its forecast following weaker-than-expected conditions in the first quarter. Plunging prices for memory chips combined with a significant inventory correction resulted in a 6.2% sequential revenue decline during the first three months of the year, the researcher says.

Further boosting the semiconductor market, the rate of price erosion is expected to slow in the second half. This will allow the semiconductor market to grow at a rate of 8% compared to the first half, says iSuppli. In contrast, global semiconductor revenues are expected to decline by 3% in the first half compared to the second half of 2006.

Sequential quarterly growth will be stronger in 2008, resulting in 8.8% annual growth. However, a combination of weakening markets, overcapacity and price erosion will limit growth to 2.7% in 2009, says iSuppli.

Following 2009, global semiconductor revenue will begin to recover, iSuppli predicts.

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