LONDON – It remains to be seen whether seasonal growth or economic uncertainty will characterize the global chip market in the second-half of 2011 as the July numbers favored neither side of the argument and came in flat and in-line with expectations.
The three-month average of worldwide sales of semiconductors was $24.85 billion in July 2011, as compiled by World Semiconductor Trade Statistics organization (WSTS) and reported by the Semiconductor Industry Association (SIA).
This is essentially flat compared with the prior month's three-month average when sales were $24.68 billion and is a 1.1 percent decrease from the same figure a year ago.
The figures were roughly in-line with analysts' expectations – Bruce Diesen of Carnegie forecast $24.8 billion and Mike Cowan forecast $25.0 billion. There were also signs of a recovery in the Japanese market, which grew month sequentially the fastest of the regional markets that WSTS tracks.
Japan's three-month average sales for July were $3.47 billion, up 4.9 percent compared with the three-month average for June. All the other regions – the Americas, Europe and Asia-Pacific declined, which runs counter to seasonal norms. However, despite its recovery Japan's July figure is 10.3 percent behind where it was in July 2010, while Europe and Asia-Pacific are 0.7 and 1.5 percent ahead, respectively.
The SIA and the European Semiconductor Industry Association publish monthly data as three-month-average figures. This makes the sales of any given month the average of the sales for that month and the previous two months. The SIA and ESIA prefer to present this data as it smoothes out the actual data that usually show troughs at the beginnings of the quarters and peaks at the ends of the quarters.
"Although the industry has experienced a slowing in the rate of growth in recent months amidst global economic uncertainty, we expect seasonal demand to drive sales growth in the second half of the year through the holiday season," said Brian Toohey, president, Semiconductor Industry Association, in a statement.
The demand of chips can be estimated through the sales in retail space. There are fewer customers in electronics store. It is not a surprise that the net growth is zero. The question is whether China market is able to catch up on spending to maintain the global demand of electronics.