The value of ICs held in inventory by chip suppliers at the end of the first quarter of 2013 was $37.6 billion, down 4.6 percent from $38.4 billion at the end of the fourth quarter of 2012, according to market analytics company IHS.
The decline is due to a resumption of demand from distributors, OEMs and contract manufacturers in anticipation of better equipment sales in the second half of 2013.
The decline in inventory in 1Q13 paralleled a sequential contraction in semiconductor revenues of 5.1 percent in line with normal seasonal demand.
However, just the chip suppliers ran down stocks so equipment companies started to ramp them. Mobile phone makers expanded their inventories by 7.2 percent during the quarter and PC OEMs expanded their backlog of notebook and desktop computers by 6 percent.
Semiconductor inventory levels at chip suppliers are expected to rise in the second quarter as they respond to positive order rates from electronics equipment manufacturers. Stockpiles for consumers of semiconductors likely will remain fairly flat, IHS said.
Quarterly inventory held by semiconductor suppliers. Source: IHS.
"The rise in inventories among the various segments of the supply chain [other than chip suppliers] indicates the electronics industry is preparing for an increase in demand during the second half of 2013," Sharon Stiefel, analyst for semiconductor market intelligence for IHS, in a statement posted at the IHS website.
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