Semico Says Semiconductor Market Will Decline by 2% This Year

Recently, SemicoResearch, a semiconductor industry research institute, lowered its forecast for the chip market in 2011 and forecast that the market sales will decline by 2% from 2010. The agency previously forecast that the growth rate of the wafer market in 2011 was 6%, while other market research institutions recently forecasted the growth rate of the wafer market this year to be around 6% or more.

Semico's downward revision of forecasting data may be the most disturbing sign since the chip market started to decline in 2011; many chip makers and semiconductor-related companies have recently issued poor warnings in the second half of the year. Semico President Jim Feldhan said during an interview with EETimes that the company decided to downgrade its growth forecast based on customer talks and other indications of lack of momentum in the chip market in the second half of 2011.

Feldhan pointed out that some people still believe that the chip industry will continue to grow at a single-digit rate in 2011 due to strong momentum in the fourth quarter; but he does not think the possibility is high. Not long ago, the United States Semiconductor Industry Association (SIA) also announced a three-month average of sales in the global semiconductor industry in July, which was US$24.85 billion, a decrease of 1.1% from the same month in 2010. The above data is roughly in line with the predictions of analysts such as Bruce Diesen and Mike Cowan. The SIA also reported signs of recovery in the Japanese semiconductor market.

ICInsights, another market research institution, also reduced its 2011 semiconductor industry growth rate forecast from 10% to 5% last month; Gartner's 2011 semiconductor industry growth rate forecast was revised down from 6.2% to 5.1. %. In addition, SemiconductorIntelligence reduced the previously forecasted semiconductor market growth rate of 9% in 2011 to 4%. Contrary to numerous industry opinions, IHSiSuppli, the agency's 2011 chip market growth rate in 2011, was revised from 7% to 7.2%.

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