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IC industry posts record sales in June, says analyst

Posted: 11 Aug 2014 ?? ?Print Version ?Bookmark and Share

Keywords:WSTS? SIA? semiconductor industry? chip sales? Internet of Things?

According to the data compiled by the World Semiconductor Trade Statistics (WSTS) organisation and endorsed by Semiconductor Industry Association, global semiconductor industry sales in June rose 10.8 per cent, to $27.57 billion from $24.88 billion in June 2013, and 2.6 per cent from $26.86 billion in May. Improved economic conditions worldwide, particularly in the U.S., and a booming memory chip market are being credited for the global semiconductor industry's strong sales growth in 1H14.

June's numbers represent the industry's highest monthly sales level recorded, according to the SIA.

In 2Q14, worldwide chip sales reached $82.7 billion, up 10.8 per cent from 2Q13, and 5.4 per cent sequentially. Global sales were up 11.1 per cent in 1H14 compared to the same period in 2013, which was a record year for semiconductor revenue. WSTS projects growth of 6.5 per cent in 2014, 3.3 per cent in 2015, and 4.3 per cent in 2016, said SIA President and CEO Brian Toohey.

"The semiconductor industry is on pace for record sales in 2014, and conditions are favourable for continued market strength for the remainder of 2014 and beyond," Toohey stated.

Toohey said that sales are up this year across nearly all semiconductor product categories, "which shows the breadth of the market's strength in 2014." Memory products, including DRAM, have been one of the strongest sectors.

"Memory chips go into a wide range of end products, including PCs and communications devices, which represent the two largest semiconductor end use markets. Strong demand for memory chips, combined with less added production capacity, has led prices to increase and revenues to grow," he said. Toohey also cited the analogue and logic chip markets as key contributors.

In June, DRAM was up 29.2 per cent compared to June 2013, analogue was up 13.5 per cent, and logic was up 12.1 per cent, according to WSTS.

Geographically, the Americas posted the largest sequential gains in June, growing 4.9 per cent compared with May 2014. Semiconductor sales in Asia-Pacific, as well as Japan, grew 2.1 per cent, and Europe inched up 1.9 per cent. And the gains were even larger compared to June 2013 as sales increased 12.1 per cent in both the Americas and Europe, 10.5 per cent in Asia Pacific, 8.5 per cent in Japan.

"In terms of growth drivers, PCs still represent the largest end product for semiconductors, and demand for smartphones and tablets is on the rise," Toohey said. Although these product categories will remain important drivers of market strength, the pie is constantly getting bigger, he added.

"Emerging product markets, the Internet of Things, big data, medical, transportation and others, will continue to grow and help ensure the continued strength of the semiconductor industry for years to come," Toohey said.

In addition, the global semiconductor market is likely to sustain its progress in subsequent years as worldwide economic growth gradually accelerates in developed economies. According to a recent Dun & Bradstreet report, worldwide GDP growth is estimated at 2.7 per cent above last year's marginal gain of 2.4 per cent and well below 2007's pre-recession rate of 5.2 per cent. Dun & Bradstreet expects conditions to gradually accelerate over the next few years, citing a 3.3 per cent worldwide growth increase in real GDP for 2015, with further advancements to occur over the next three years.

- Ismini Scouras
??EE Times

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