"The lovers, the dreamers, and we"
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CUPERTINO, Calif. -- Tossing a bucket of cold numbers on hopes for a chip recovery,
Advanced Forecasting Inc. today said its market models do not yet show any signs of
improvement in semiconductor revenues despite encouraging remarks by some of the
industry's largest players.
The Cupertino research firm said it believes the industry has not approached the bottom of
the current semiconductor recession and recent data from June does not suggest a trough
is likely in the third quarter. Advanced Forecasting added that it "not encouraged by the
downward direction" of its own IC Recovery Index. "The decline in actual sales of ICs and
semiconductor production systems support this outlook," said the research firm.
In addition, Advanced Forecasting said recent suggestions about the potential for sequential
growth in business--including statements from officials at Inte Corp. and Applied Materials
Inc.--are based on "vague signals" in weak markets. Advanced Forecasting has long claimed
to have quantitative based models that have accurately predicted inflection points in up and
down semiconductor business cycles.
"Unfortunately, as with actual IC revenue, our IC Recovery Index continues its downward
trend without any signs of the model slowing its descent," said David Crume, director of
marketing and sales at Advanced Forecasting. "As we had expected, the month of May did
not represent a minimum for IC sales."
Advanced Forecasting said it is not expecting to see a clear bottom for June when industry
data is available for actual chip shipments in July. The research firm cites a rapid decline in
its IC Recovery Index and continued weak demand for devices in key applications.
"Actually, the IC industry broke a record in June," Crume said. "The rate of decline in June of
IC revenues reached 32.3% below their level a year earlier, surpassing the record of 1985,
30.9%." Advanced Forecasting calculates the rate of decline on a 3-month moving average,
year over year.
The Semiconductor Industry Association recently reported that June's worldwide IC
sales--$11.6 billion--were 8.8% below May. Advanced Forecasting noted that seasonally
adjusted monthly shipments showed a gain in shipments in June, but it was not impressed.
"Seasonally adjusted numbers can be misleading during a year of recession with eight
months of declining sales," Crume said. |
