SAN FRANCISCO Strong end market growth and stabilizing average selling prices (ASPs) will drive semiconductor industry revenue to $316 billion in 2008, an increase of nearly 18 percent from projected 2007 chip industry sales, according to a forecast issued Tuesday (April 10) by market watcher Objective Analysis.
Objective Analysis said it projects chip revenue growth of 6.3 percent in 2007, based in large part on improved ASPs.
"The first quarter of 2007 was not as dire for the semiconductor industry as some have suggested," said Dave Cavanaugh, Objective Analysis' director of manufacturing, in a statement. "Recent gains in new orders and low inventories of end-market electronics have already improved the pace of a slow-starting quarter."
Foundry wafer demand will grow faster than capacity later this year, especially at the 65-nm node and below, increasing foundry utilization rates and ASPs, Objective Analysis said. This increase, coupled with greater demand in the communications and gaming end markets, will drive higher ASPs for logic and programmable devices, the firm said.
A slowing in memory capacity additions will stabilize memory ASPs, especially those of NAND flash, Objective Analysis said. Nearly all of 2007's expected price declines will have occurred in the early months of the year, the firm said.
The Objective Analysis forecast is bullish compared with others recently issued. Last week, Semico Research Corp. lowered its semiconductor forecast for the second time in recent weeks, saying that the IC market will grow a mere 1.8 percent this year.
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