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TI dominates 2010 analog IC market

Posted: 30 Mar 2011 ?? ?Print Version ?Bookmark and Share

Keywords:analog? IC? market? sales?

With a 15 percent share of the analog IC market in 2010, Texas Instruments Inc. (TI) remains the world's top market player, according to Databeans Inc. According to the market research firm, TI reported $6.2 billion in sales in 2010, almost 15 percent of the total analog IC market revenue of $42.29 billion.

The company's IC analog sales was 42 percent more than in 2009. STMicroelectronics NV, the No. 2 in sales, on the other hand, sold some $4.3 billion worth of IC analog products last year.

Industrial markets accounted for most of TI's analog production as demand from the consumer sector slowed down. TI's fourth-quarter analog growth was fueled by high-performance analog products, along with HVAL and power management. Inventory was up more than 25 percent in the fourth quarter at $1.5 billion, compared to $1.2 billion a year earlier, said Databeans. The research firm expects TI to continue to build inventory.

Databeans said TI has been using its vast cash reserves over the past year to build new fabs or buy existing ones from other companies, as well as to increase its sales and engineering operations in China and India. In 2010, the company purchased two fabs from Spansion. It also began expanding its large RFAB 300mm analog fab in Richardson, Texas, with the aim of increasing manufacturing capability for an additional $2 billion of analog revenue per year. TI said it has increased manufacturing capacity last year to support $5 billion a year in new sales.

"These moves helped TI increase its market share in analog even further ahead of its competitors," Databeans said in a statement. "When many firms were still scrambling just to survive the recession, TI used the downturn to replenish its inventory, return product lead times to normal and ramp up production quickly with its three new fabs. As markets began to grow again, the company was well positioned to pounce on returning consumer demand."

Databeans added that TI has learned a lesson after it failed to prepare for strong demand in analog ICs a couple of years ago. "In response, TI went on a buying binge, buying up fabs during the recession, many at a discount, and building up the buffer inventory it needed to reduce its lead times," the research firm said. Databeans stressed, however, that while TI should fare well with its strategy in the near term, a sudden increase in inventory in the future could prove dangerous to the semiconductor maker.

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