Semiconductor Industry Revenue to Endure Slow Year in 2012

An uncertain global economy and insufficient inventory movement are culprits

January 24, 2012 

With global economic prospects remaining uncertain and semiconductor inventory not moving quickly enough to stimulate new production, the worldwide chip market is expected to suffer a slow year in 2012 marked by sluggish growth at best, according to an IHS iSuppli Global manufacturing market tracker report from information and analysis provider IHS.

Semiconductor industry revenue in 2012 is expected to reach $323.2 billion, up a slight 3.3 percent from last years revenue of $312.8 billion. While expansion this year was better than the paltry 1.25 per- cent increase of 2011, the overall picture could brighten considerably if the United States and the rest of the world recover in 2013. Under such a scenario, growth from 2013 to 2015 will average between a more encouraging 6.6 to 7.9 percent, as shown by Figure 3, with total semiconductor revenue by 2015 rising to some $397.7 billion.

Much of the weak performance in both 2011 and this year can be attributed to external circumstanc- es over which the semiconductor industry has no control—the ambiguous state of the global economy, along with assorted troubles in the worlds major markets of the United States, Europe, Japan and China. And because the world economy is not in a strong-enough position to drive growth, the semiconductor trade is coming under pressure, IHS believes.

Consumer expenditure is also a key factor. Though consumer spending lowered the overall inven- tory of electronics and other items with related semiconductor content during the 2011 holiday season, the reduction was insufficient to re-energize chip demand. Worse, a deliberate decrease in manufacturing run rates by companies in the third quarter of 2011 proved unable to bring inventory down to levels that w ould h a v e fired up additional orders and increased facto r y r un rate s . As a result, demand on ma n ufactu r - ers will remain d e pressed until the second qua r ter of 2012.

Su c h de v elopments will h a v e a ripple effect throughout the indust r y . F or instanc e , because facto r y utilization will not rec o v er until the middle of 2012, the inte g rated device ma n ufacturers (IDM) that both design and ma n ufacture semiconductors in-house will experience e v en g reater stress to simply maintain the viability of   unde r perfo r ming   factorie s . And with cu r rent ma n ufacturing   capacity deemed acc e pt- able for meeting demand, most capital expenditures to boost e f ficiency within the indust r y li k ely will be pushed out to 2013.


1 | 2  Next Page »



Review Article Be the first to review this article
CST Webinar Series

EMA:

Featured Video
Editorial
Peggy AycinenaWhat Would Joe Do?
by Peggy Aycinena
Retail Therapy: Jump starting Black Friday
Peggy AycinenaIP Showcase
by Peggy Aycinena
REUSE 2016: Addressing the Four Freedoms
More Editorial  
Jobs
ACCOUNT MANAGER MUNICH GERMANY EU for EDA Careers at MUNICH, Germany
Manager, Field Applications Engineering for Real Intent at Sunnyvale, CA
Development Engineer-WEB SKILLS +++ for EDA Careers at North Valley, CA
Principal Circuit Design Engineer for Rambus at Sunnyvale, CA
FAE FIELD APPLICATIONS SAN DIEGO for EDA Careers at San Diego, CA
AE-APPS SUPPORT/TMM for EDA Careers at San Jose-SOCAL-AZ, CA
Upcoming Events
Zuken Innovation World 2017, April 24 - 26, 2017, Hilton Head Marriott Resort & Spa in Hilton Head Island, SC at Hilton Head Marriott Resort & Spa Hilton Head Island NC - Apr 24 - 26, 2017
CST Webinar Series



Internet Business Systems © 2016 Internet Business Systems, Inc.
595 Millich Dr., Suite 216, Campbell, CA 95008
+1 (408)-337-6870 — Contact Us, or visit our other sites:
AECCafe - Architectural Design and Engineering TechJobsCafe - Technical Jobs and Resumes GISCafe - Geographical Information Services  MCADCafe - Mechanical Design and Engineering ShareCG - Share Computer Graphic (CG) Animation, 3D Art and 3D Models
  Privacy Policy