Worldwide semiconductor sales rose 10% year-over-year in April but failed to budge from March as electronic equipment makers deferred purchases due to the absence of strong demand from corporations, according to a trade business organization.
April chip sales totaled $12.1 billion, up from $11.1 billion in April 2002 but virtually unchanged from March, the Semiconductor Industry Association reported late Friday.
Although chip sales had been expected to increase on a sequential basis, corporate IT equipment purchases remained unimpressive contributing to the weaker than expected April results even as the outbreak of the SARS virus further complicated the market situation.
"Sluggish global economic growth and the Chinese SARS outbreak caused a deferral of sales in April to future months," said George Scalise, president of the SIA, in a statement.
"In the United States, an anticipated corporate PC upgrade cycle, expected to add strength to continuing consumer purchases of PCs, has again been pushed back, as executives cite continuing uncertainty and reduced visibility," Scalise added.
The wireless handset market, which had in the past propped up chip revenue, weakened in April with digital signal processor sales dropping 10% on a 12% decline in unit shipment.
Meanwhile flash memory sales were almost unchanged while microprocessor sales fell more than 1%.
DRAM sales declined a sharper 5% offsetting a 6% upswing in application specific standard products and a 3% climb in optoelectronics IC sales, according to the SIA.
"The three-month average of world chip sales was unchanged in April, weaker than we had expected," said Bruce Diessen, an analyst at Sweden's Handelsbanken. "Main processors was the weakest category with sharply lower prices and lower sales, especially to Japan."
The SIA reported that capacity utilization at leading-edge fabrication plants continued to improve, climbing to 97% in April with inventories remaining "at or below target levels," according to the SIA's Scalise.
By region, sales in the Americas fell 1% on a sequential basis and 9% from April 2002, to $2.4 billion.
Europe grew 10% from the year-ago month but fell slightly from the immediately preceding month to $2.4 billion while sales in the Asia-Pacific region climbed almost 1% sequentially and 12% year-over-year to $4.4 billion
Japan recorded the strongest year-over-year growth, rising 29%, to $2.84 billion from $2.2 billion in April 2002.