LONDON The three month moving average of global chip sales was $21.8 billion in May, 7.5 percent up on the $20.3 billion reported for May 2007, according to the Semiconductor Industry Association (SIA) and based on figures from WSTS.
May sales were 2.8 percent higher than the $21.2 billion reported for April 2008. Year-to-date sales of $103.4 billion are up by 5.3 percent from the $98.2 billion reported for the first five months of 2007.
Total semiconductor sales excluding memory products were up by 12.3 percent year-on-year and by 2.5 percent sequentially.
SIA noted that May is historically a relatively strong month for semiconductor sales.
Commenting on the figures, Bruce Diesen, analyst at Carnegie ASA, suggested actual sales rose 9.2 percent year on year, against the company's forecast of 7 percent growth. He adds estimated volumes slipped from 13.5 percent growth to 12 percent, indicating strength was more because of pricing and currency fluctuations than volume increases.
Late last week, Diesen suggested the three-month moving average would come in at $21.7 billion in May, up 7 percent.
According to SIA president George Scalise: "Global sales of semiconductors grew at a healthy rate in May reflecting continued strong sales of consumer electronic products. Despite reports of declining consumer confidence in the U.S., both disposable income and consumer spending rose in May. It is likely that the distribution of tax rebate checks to millions of Americans was a factor in increased consumer spending."
Scalise notes that increasing sales of consumer electronic products in emerging markets, including China, Latin America, and India, have become a major factor driving semiconductor sales.
"In the past, the U.S was the largest consumer market and the primary driver of demand. Today [the U.S.] accounts for less than a quarter of total consumer demand," Scalise noted.
He adds factors impacting the world economy rather than just developed country markets are increasingly important to the industry.
"Until recently, the U.S. accounted for approximately 31 percent of PC unit sales. Today, with the growth of the consumer base in emerging markets, the U.S. accounts for around 21 percent of PC unit sales. Five years ago, the U.S accounted for 21 percent of cell phone unit sales, and in 2008 that figure will be 13 percent."
Scalise adds unit demand for memory chips continues to be strong. Micron estimates that the DRAM bit content of an average personal computer will grow by approximately 50 percent in 2008 to nearly 2.0 GB per box.
According to Credit Suisse, capital expenditures for DRAM capacity will slow somewhat in 2008, bringing supply and demand into parity by the end of this year. DRAM sales were up sequentially by 6.4% but declined by more than 20% from May 2007.
In NAND flash, Credit Suisse estimates that total bit shipments will grow by at least 135 percent in 2008 and that supply and demand will be nearing parity by year-end. NAND flash sales grew by 1.4 percent sequentially and by 25.5 percent from May 2007.
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