Semiconductor industry to grow by 10.3% in 2010

Global research firm Gartner today raised it outlook of semiconductor industry by predicting that revenues will fall by 17% in 2009 compared to 2008, which is better than their earlier estimate of minus 22%. Gartner's research Vice-President Bryan Lewis said in a statement that "The semiconductor market has performed better than expected as was evident when second quarter semiconductor revenue increased 17 per cent in sequential sales". He attributed this to stimulus package in China and strong consumer demand as a result of reduced price of PC and LCD TV.

According to Gartner all major segments of semiconductor market are expected to decline in 2009. The largest segment of the semiconductor market, ASSP(Appliction-Specific Standard Product) will reach $57.2 billion in 2009, but this is a 16.5 per cent decline from 2008 revenue. The memory market, the second largest segment is forecast to touch $41 billion, a 13.5 per cent decline from last year. The microcomponents segments is on place to reach $39.4 billion in 2009, a 19.2 per cent decline from 2008.

In its outlook for 2010, Gartner said the worldwide semiconductor revenue was expected to total $233 billion, a 10.3 per cent increase from 2009 projections. Gartner expects the fourth quarter of 2009 to be positive but foundries have reported they are concerned that demand may drop of more than seasonal in the fourth quarter and it may carry into first quarter of 2010. Gartner's most likely scenario was a negative five per cent growth in the first quarter of 2010 as customers take a pause and absorb all the devices they purchased over the previous three quarters.