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daleste
I really do hate to see these kind of reports. Sometimes it seems like the are ...
ABIsemis
Unlike many other research firms, ABI Research have been predicting a WW ...
Chip market now seen shrinking in '12
Dylan McGrath
8/23/2012 1:27 PM EDT
SAN FRANCISCO—A key market watcher is expected to announce Friday (Aug. 24) a downgraded 2012 chip market forecast projecting sales to decline slightly compared to 2011.
Based on weak economic conditions and a corresponding reduction in demand for PCs and other electronics, IHS iSuppli (Englewood, Colo.) now expects semiconductor sales to contract by 0.1 percent compared to 2011. The projection is based on preliminary results from the firm's IHS iSuppli Application Market Forecast Tool (AMFT).
Previously, the IHS AMFT had forecast marginal chip market growth of less than 3 percent.
If the projection is accurate, 2012 will mark the first year of decline for the chip market since 2009.
"The expected decline in 2012 represents a major event for the global semiconductor market," said Dale Ford, senior director at IHS.
Several semiconductor market watchers have reduced their forecasts for the 2012 market in recent weeks, including IC Insights Inc., Semico Research Corp. and Future Horizons Ltd. A number of analysts are now projecting that 2012 sales will be roughly flat with 2011, and some--including veteran semiconductor market analyst Mike Cowan and research firm Semiconductor Intelligence--now project that the market will contract this year. Other notable market watchers are still projecting growth ranging from 2 to 8 percent for the year.
Ford said that while electronics markets were very weak throughout 2011, IHS never projected chip sales to decline for the year. But disappointing results in the second quarter and weak third quarter expectations driven by poor economic conditions promoted IHS to project slight contraction for the year, he said.
Global chip sales declined 3.6 percent in the first quarter compared with the fourth quarter of 2011, IHS said, reflecting normal seasonal patterns, But chip sales grew only 3 percent in the second quarter compared with the first quarter, a tepid increase when compared to historical seasonal averages, the firm said.
If the semiconductor industry were on a trajectory for stronger growth in 2012 compared to 2011, second-quarter sequential growth would have been expected to amount to at least 4 percent or more, IHS said.
Next: Q3 boost won't be enough
Based on weak economic conditions and a corresponding reduction in demand for PCs and other electronics, IHS iSuppli (Englewood, Colo.) now expects semiconductor sales to contract by 0.1 percent compared to 2011. The projection is based on preliminary results from the firm's IHS iSuppli Application Market Forecast Tool (AMFT).
Previously, the IHS AMFT had forecast marginal chip market growth of less than 3 percent.
If the projection is accurate, 2012 will mark the first year of decline for the chip market since 2009.
"The expected decline in 2012 represents a major event for the global semiconductor market," said Dale Ford, senior director at IHS.
Several semiconductor market watchers have reduced their forecasts for the 2012 market in recent weeks, including IC Insights Inc., Semico Research Corp. and Future Horizons Ltd. A number of analysts are now projecting that 2012 sales will be roughly flat with 2011, and some--including veteran semiconductor market analyst Mike Cowan and research firm Semiconductor Intelligence--now project that the market will contract this year. Other notable market watchers are still projecting growth ranging from 2 to 8 percent for the year.
Ford said that while electronics markets were very weak throughout 2011, IHS never projected chip sales to decline for the year. But disappointing results in the second quarter and weak third quarter expectations driven by poor economic conditions promoted IHS to project slight contraction for the year, he said.
Global chip sales declined 3.6 percent in the first quarter compared with the fourth quarter of 2011, IHS said, reflecting normal seasonal patterns, But chip sales grew only 3 percent in the second quarter compared with the first quarter, a tepid increase when compared to historical seasonal averages, the firm said.
If the semiconductor industry were on a trajectory for stronger growth in 2012 compared to 2011, second-quarter sequential growth would have been expected to amount to at least 4 percent or more, IHS said.
Next: Q3 boost won't be enough
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Cowan LRA Model
8/23/2012 4:56 PM EDT
Hi Dylan - I wanted to make you aware that I updated my forecast for 2012 global semi sales and sales growth to $297 billion and minus 0.9 percent, respectively, at the beginning of August following the release of June's HBR by the WSTS.
Additionally, Semiconductor Intelligence's latest sales growth forecast for 2012 was also changed to -1.0 percent on August 16th. Details can be seen at the following URL = http://www.semiconductorintelligence.com/?p=600.
Mike C.
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dylan.mcgrath
8/23/2012 7:41 PM EDT
Thanks Mike. Sorry for the mix up. I'll update the chart.
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GoGoGeek
8/24/2012 12:56 PM EDT
Revenue effects spending as well! I think SEMI will come out with their worldfabforecast report next week. Should be interesting!
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daleste
8/24/2012 11:35 PM EDT
It did feel like the economy was not improving as much as the old numbers showed. I hope 2013 really will be a good growth year.
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eewiz
8/25/2012 5:16 AM EDT
Analysts.. I believe them. Totally.
Here is an analyst report from 2007 about iPhone, that I enjoyed reading.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aRelVKWbMAv0
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dylan.mcgrath
8/25/2012 11:19 PM EDT
@eewiz- nice reference. It was fun reading. Indeed, I think it's safe to say that they analysts quoted in that story were off the mark.
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ABIsemis
8/29/2012 10:00 AM EDT
Unlike many other research firms, ABI Research have been predicting a WW semiconductor market decline since our 1Q12 review of the market. This was reiterated in a press release in June as published by EE Times:
http://www.eetimes.com/electronics-news/4391761/Chip-market-will-fall-2012-says-ABI
I'm surprised that we have not been included in the list.
Peter Cooney - ABI Research Practice Director, Semiconductors
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daleste
8/31/2012 12:10 AM EDT
I really do hate to see these kind of reports. Sometimes it seems like the are a self fulfilling prophecy more than a prediction based on the trends seen in the numbers.
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