Semiconductor sales surge in first half of year

Outstanding results for the first half of the year show that the semiconductor industry is in for a strong year.

“These results are outstanding, way better than even we dared to expect less than two weeks ago when we raised eyebrows by suggesting a 2.3 per cent quarterly growth,” said Malcolm Penn, CEO of Europe’s leading semiconductor analyst company, Future Horizons.

“Take memories out of the equation and the results are even stronger”, added Penn, “we can only reiterate our recent forecast message; the momentum and underlying fundamentals are strong and the fire is stoked for a strong second-half rebound.”

On a year-on-year basis, total semiconductor sales and ASPs in June were up 12.2 and 11.8 per cent respectively, with logic the star performer (up 25.3 and 16.6 per cent), followed by analogue (14.5 and 0.2 per cent) and microprocessors (12.2 and 6.5 per cent), let down only by memory (minus 5.8 per cent in sales and minus 10.2 per cent in ASPs).

The market excluding memories was up 18.1 per cent in value versus June 2007, driven by a 11.2 per cent increase in units and 6.2 per cent growth in ASPs.

“It really begs the question, why is everyone still so down on semis?” asked Penn, “in any other circumstances, these are numbers to die for.”

On a regional basis, sales were up a surprisingly strong 11.3 per cent in the USA, 7.5 percent in Europe, 3.0 percent in Japan and 17.6 per cent in Asia Pacific, where the impact of the sub-prime markets and subsequent economic melt down has been minimal.

“Given the recent IMF upward revision of world GDP growth from 3.7 to 4.1 percent, it is now highly improbable that Q3 growth will be less than 10 per cent quarter on quarter”, said Penn.

Reflecting on the industry’s pessimism despite the growth figures Penn attributes the downbeat mood to: “Some of the traditional chip firms are in trauma, wrestling to reinvent themselves and, in so doing, losing track of the market. The result is performances at a company-by-company level that are all over the map, with some firms showing strong double digit quarterly growth, whilst others are shrinking, even within the same applications sector.”