Chip industry revenue will decline 16.2%
Researcher is pessimistic about 2009, but sees double-digit growth in 2010
By Jim Carbone -- Purchasing, 12/17/2008 2:28:00 PM
Worldwide semiconductor revenue will fall 16.2% to $219.2 billion in 2009, marking the first time in history the chip industry had two consecutive years of negative growth, according to researcher Gartner Inc. In 2008, revenue will drop 4.4% to 261.9 billion.
According to a press release from Gartner, in 2001, the semiconductor industry experienced its worst revenue decline in history with sales declining 32.5% from the previous year. However, that collapse was following two strong revenue growth years in 1999 and 2000 when revenue grew 22% and 34%, respectively. Gartner analysts said the wild card for the semiconductor industry in 2009 is DRAM. The DRAM industry has been in a downturn for 18 months and losses are now approaching $12 billion.
“The DRAM market is so bad that suppliers must either significantly scale back supply, or the weaker players will be forced into mergers or bankruptcy,”says Andrew Norwood, research vice president at Gartner. “Either way, we are expecting DRAM pricing to firm during the second half of 2009, and this has the potential to moderate the decline in 2009 semiconductor revenue," he says. So, Gartner expects the semiconductor industry to bounce back in 2010 and 2011, with worldwide semiconductor revenue reaching $251.2 billion in 2010, a 14.6% increase from 2009, and in 2011 revenue reaching $274.9 billion, a 9.4% increase from the previous year.
Also see: Memory IC price erosion weakens semiconductor industry's growth
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