SAN FRANCISCO—The market for power management chips recovered in the second quarter after six months of decline due to strong demand for electronic products including smartphones and media tablets, according to preliminary projections from market research firm IHS iSuppli.
Total sales of power management semiconductors is estimated to have reached $7.9 billion in the second quarter, a 9.7 percent increase from the first quarter, IHS said. The increase comes on the heels of a 4 percent decline in the first quarter and a 10.7 percent decline in the fourth quarter of 2011, IHS said.
"While lack of demand was to blame for the dismal performance during the fourth and first quarters, a pickup in the market for power management chips in consumer-type products is believed to have returned the market to growth in the second quarter," said Marijana Vukicevic, senior principal analyst for power management at IHS, in a statement.
Vukicevic said the products that fueled growth for power management chips in the second quarter included mobile handsets, media tablets, personal computers and other consumer electronic items, such as digital still cameras. "In these devices, efficient power management is becoming more important to consumers—a significant feature given that electronic devices are almost never shut off or powered down anymore," Vukicevic said.
IHS said it expects the second quarter revenue increase to help reverse some of the inventory buildup of power management chips that accumulated in the channel for the past three quarters. Continued growth is expected for the remaining two quarters of the year as the markets head to their busy selling season, IHS said.
Overall, 2012 power management revenue is forecast to reach $32.4 billion, up 1.7 percent from 2011,according to the firm. IHS expects more growth in the years ahead for power management ICs as consumer markets regain some vigor starting in 2013, while growth continues in the industrial and alternative energy sectors—traditionally home to a strong power management revenue base.
IHS said it expects the largest expansion in power management ICs over the next five years to occur in media tablets and mobile handsets. The firm expects power management IC revenue from those two product areas to achieve a compound annual growth rate of nearly 30 percent and 11.7 percent, respectively. Power management chip sales are expected to increase at a CAGR of 13.1 percent in mobile infrastructure and 12.3 percent in set-top boxes over the same period, IHS said.