14 DAY TRIAL // Apparently, the chip market has been performing better than even the most tried market analysts expected a few months ago. Back in May, iSupply foresaw an on-year increase of about 30.9 percent. This figure even looked quite promising and implied that revenues would grow by a great sum compared to the $229.6 billion of last year. Now, prompted by a strong surge in sales of electronic equipment, the research firm decided to adjust its forecast upwards.
What iSupply now believes is that the global semiconductor revenue, for the whole of 2010, “has been injected with a powerful dose of growth steroids” and will increase by 35.1 percent, with the final figure being of $310.3 billion. This $80.7 billion jump will practically become the largest annual expansion in semiconductor revenue in history (in dollar terms). The year of 2,000 will likely be left with second place. Back then, revenues amounted to just under $60 billion. Shipments are surpassing expectations in the areas of PCs, cellphones and LCD TVs, and inflated prices will also contribute to the final performance of the segment.
“The semiconductor market already was in for beefy growth in 2010 because of strong consumer demand for electronic products,” observed Dale Ford, senior vice president for iSuppli. “However, it’s now apparent that semiconductor sales are getting an infusion of growth hormone in 2010 because of a number of factors, including rising prices, inventory buildups and richer chip content in key electronic products like smart phones and advanced LCD-TVs. All this is causing chip revenue to bulge to awesome dimensions this year.”
“Careful management of semiconductor inventories and tight controls on manufacturing capacity have resulted in an environment where supply is not able to match demand,” Ford said. “As a result, prices for many semiconductor segments are inflated.”