Chip Revenues To Fall 16% This Year, Report Says
Electronic News -- 5/15/01 11:20:00 AM
Electronic News
The semiconductor industry is expected to see worldwide revenues fall nearly 16 percent to $170 billion in 2001, according to a new report from Scottsdale, Ariz.-based Cahners In-Stat Group. This is a significant drop from 2000’s growth of 36.8 percent to a record $204.4 billion.
Early quarters are showing a significant sequential downturn, but recovery is expected to begin in the second half of this year as inventories are worked off, the company said.
“Even though growth in 2001 was bound to be lower, the overall economic slowdown and crash of the dot-coms has caused the semiconductor slowdown to occur sooner and more abruptly than previously expected,” said Steve Cullen, director of In-Stat’s semiconductor group, in a statement. “Instead of slower growth, we expect a reversal of direction in 2001 with worldwide semiconductor revenues falling by 15.8 percent to $170 billion.”
In-Stat predicts the industry’s recovery will be as fast as the decline, which companies responded to with an abrupt reduction in capital spending in an attempt to minimize an inventory glut.
“Although the sales growth of key end products including PCs, cell phones and networking hardware has slowed, most of these segments will exhibit some unit growth in 2001,” Cullen said. “However enough of the unit growth will be satisfied by existing inventory that semiconductor unit growth is also expected to decline, by 10.8 percent to 333 billion.”
Average selling prices for chips are expected to fall by 5.7 percent this year to about 52 cents, as capacity exceeds demand for most part types. In-Stat believes 2002 will see a return to both unit and revenue growth with more normal growth patterns by 2003.
In-Stat's parent company also owns Electronic News. |
