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IC industry recovers from recession

Posted: 04 May 2011 ?? ?Print Version ?Bookmark and Share

Keywords:semiconductor industry? recovery? handheld gadgets? CD/DVD? flash drives?

The year 2010 was an excellent year for the semiconductor industry as it overcame the great recession that happened in late 2008 to early 2009 much faster than other industries, says a report from New Venture Research.

According to the report, handheld gadgets from smart cellphones to tablets are the primary drivers behind this recovery while the auto industry is also on an uptick. New Venture Research presented the following list of the few select end products.

IC packaging

Tablets are new to the market, thus have low unit figures. However, the compound annual growth rate (CAGR) of 59.8 percent is impressive enough to make one take notice. Smartphones also have an impressive growth rate of 15.2 percent for the years 2011 through 2015. Also, the hard disk drives, CD/DVD drives, and flash drives are just simply large markets. All these point to a healthy market for ICs.

The shipment of ICs grew 28.9 percent from 2009 to 2010. The prevalence of ICs in our daily lives, keeping us connected all the time, will continue to show an annual increase, but a slower growth, of 7.52 CAGR from 2010 through 2015. Unit shipments of ICs will be 267,811 million in 2015. Approximately 68 percent of these shipments are lead-frame based throughout the forecast period.

With this industry having its cycles every four years (a downturn or softening of the market the first year of a new president in the United States), 2013 will see a tapering of growth rates, to only 4.8 percent that year.

After a revenue growth of 31.3 percent from 2009 to 2010, the CAGR for IC revenue will be 7.42 percent for the years 2011 to 2015. Revenue for these chips will grow from $249,911 million in 2010 to $357,413 million in 2015. This is still quite healthy, although slightly behind unit growth.

The total package assembly revenue was approximately $38.5 billion in 2010, which is predicted to expand to $57.1 billion by 2015. Package assembly revenue growth will be at an 8.18 percent CAGR through 2015, ever so slightly ahead of the total IC revenue growth of 7.42 percent.

Packaging of these integrated circuits is important, as the package holds the footprint to the PCB, and can either facilitate or hamper the speed and performance of the chip. Attachments to the package such as heatsinks must also dissipate the heat coming from the chip; failure to remove excess heat can cause device failure. Thus the right package, made of the right materials, is critical.

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