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Chip sales reach $18.8 billion in October, says SIA

Posted: 02 Dec 2004 ?? ?Print Version ?Bookmark and Share

Keywords:semiconductor? semiconductor industry association? sia? wireless handset? digital signal processors?

The three-month average of global semiconductor sales notched up a 1.5 percent sequential rise in October according to figures published Friday (Nov. 26) by the Semiconductor Industry Association, reaching $18.8 billion for the month. That represents a 22 percent increase on the $15.4 billion in sales in October 2003.

However, the SIA warned that continuing high energy prices are having some effect on discretionary spending by consumers, reducing visibility for the industry outlook for December sales.

"While we now expect that fourth-quarter sales will be essentially flat at third-quarter levels, we continue to project year-on-year growth of at least 28 percent," said SIA president George Scalise, in a statement.

The October increase reflects "ongoing inventory corrections in certain market segments," said Scalise.

Sales of digital signal processors rose by 8.5 percent sequentially, a sign that the inventory correction that began in the wireless handset market in July has run its course, according to the SIA.

Scalise said this year's pc sales have been buoyed by strength in the corporate market. "Sequential sales growth of 6.4 percent for microprocessors and 2.8 percent for drams are signs that excess inventories of these products have also been worked out of the supply chain."

Sales of consumer electronics, an increasingly important driver for the semiconductor sector and generally strong in the fourth quarter, could be a problem in the near term, the SIA warned. "These may be modulated somewhat this season by slower than expected growth in the sales of digital video recorders (DVR) and a very competitive market in DVD players, factors that have put pressure on component suppliers."

According to the SIA capacity utilization declined modestly in the third quarter, falling from 95 percent to 93 percent. Factory utilization for leading-edge facilities and foundries remained strong, at 96 percent and 98 percent respectively.

Sales in all geographic regions except Japan were up sequentially in October.

- John Walko

EE Times

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