PHOENIX--An anticipated dip in demand and average selling prices (ASPs) for semiconductors has prompted Semico Research Corp. to lower its worldwide IC growth forecast by 5%, to a healthy 25% for 2003.
In September, Semico originally projected the IC market would grow by 30% in 2003. The IC market is projected to grow only 6% in 2002, according to the Phoenix-based research firm (see Sept. 4 story ).
The firm lowered its '03 IC growth forecast from 30% to 25% for several reasons, said Jim Feldhan, president of Semico. "There were a few driving factors," Feldhan said. "First, fourth quarter revenues and the associated ASPs were coming in a bit weaker than expected," he said.
"Second, we felt that the end market demand for 2003 was reasonable and could not justify raising end demand to meet the 30% growth," he said. "Third, downward revisions to the ASP added to the decline to the 2003 growth rate."
The market researcher remains bullish. "Still, a growth of 25% in 2003 is achievable with single digit sequential quarterly growths," he added.
Semico's Inflection Point Indicator also shows the IC market has been growing since July 2002. "An increase in demand in end-use markets is one sign of impending strength, as units are forecast to increase by 18% next year," according to a recent report from Semico.
"The industry continues to grow as a result of demand from a wide variety of end-use markets, as opposed to that one 'killer application.' Wireless technologies continue to thrive. USB flash drives, as highlighted in this month's Semico Tracker, are poised to become an exploding market."