The global semiconductor industry is off to a solid start in 2014, with semiconductor sales topping the $26 billion mark for January, according to the latest numbers from the Semiconductor Industry Association (SIA).
Worldwide sales of semiconductors rose 8.8% from a year earlier to $26.28 billion, the SIA said in a report issued Monday. It's another good sign for the industry. January's total set a sales record for the month, and the year-over-year increase was the largest in three years.
The report did not state what specifically fueled the semiconductor industry's growth, but SIA analysts told us last month that the Internet of Things -- especially connected cars and homes devices such as thermostats -- are sparking interest and driving sales.
Though the numbers offer a solid start for 2014, sales did slip about 1.4% from December 2013. The SIA attributed that dip to normal seasonality in the market.
All the sales figures in the report were compiled by the World Semiconductor Trade Statistics organization.
The SIA report is not the only research pointing toward a robust year for the chip industry thanks to the growing interest in the IoT. In February, IHS predicted that the number of Internet-connected devices will top 6 billion during the next 12 months. Consumers are buying smartphones, tablets, televisions, and other devices that plug into the Internet (increasing chip sales), and they are abandoning traditional gadgets such as cellphones.
Demand for integrated devices is proving to be a boon for an industry that has watched personal computer sales slow down, especially after the 2008 recession. "Sales in January were up across most regions and nearly all product categories compared to last January, which bodes well for continued growth during the rest of 2014," Brian Toohey, the SIA's president and CEO, said in a press release.
Regionally, the Americas led the way in semiconductor sales, with a 17.3% increase from a year earlier. Sales also increased in Europe and the Asia Pacific region. Japan proved the outlier; sales there dipped about 4.7%.
In another report published Monday, Deutsche Bank analysts remained cautious about the industry as a whole but admitted that the January numbers pointed to a solid start for 2014.
"After a 2013 marked by alternating positive/negative surprises in the SIA data that left the full year growing" 5% from the previous year, "roughly in-line with our estimate, 2014 is off to a solid start and well aligned with our estimate for growth to accelerate to +8%," the report said.