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Gartner winds 2004 chip market growth back to 23%

Posted: 24 Dec 2004 ?? ?Print Version ?Bookmark and Share

Keywords:semiconductor? computer microprocessor? dram? nand flash memory? mp3 players?

Worldwide semiconductor revenue is on track for a 23 percent increase in 2004, to $218 billion in revenue, according to Gartner-Dataquest, which scaled back the annual growth figure from its August 2004 prediction of $226 billion and 27.4 percent growth.

Intel remained the number one chip vendor based on worldwide semiconductor revenue for the 13th consecutive year, based on its strength in computer microprocessor sales. Samsung Electronics increased revenue by 49 percent. The company benefited from success in the dynamic random-access memory (DRAM) and NAND flash memory markets. Samsung Electronics also is a market leader in liquid crystal displays, and driver chips, and it is competing well in microprocessors for MP3 players, digital cameras and cellular phones.

"The sudden downturn in the semiconductor market in the final months of 2004 has been caused by vendor sensitivity to an incremental buildup of channel inventory," said Gerald Van Hoy, industry analyst for Gartner's Semiconductors Worldwide group. "In a break from the past, semiconductor vendors have reacted quickly and decisively by throttling back output. They are determined to avoid the type of market crash that occurred in 2001 following a huge inventory buildup."

Texas Instruments moved into the number three position with a strong performance in wireless communications chips and application-specific products. Infineon Technologies benefited from a strong DRAM market and was Europe's largest chipmaker, moving ahead of STMicroelectronics.

On a regional basis, the Asia/Pacific market showed the strongest growth rate with a 34.6 percent increase in semiconductor revenue in 2004. Europe, Middle East and Africa (EMEA) had growth of 19.8 percent, the Americas had a 16 percent increase, and Japan rose 14.6 percent, Gartner said.

- Silicon Strategies

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