Semiconductor sales take a plunge in November

With companies and individual consumers spending less on IT due to the global economic slowdown, worldwide sales of semiconductors declined in November to $20.8 billion, a decline of 9.8 per cent from November 2007 when sales were $23.1 billion, the Semiconductor Industry Association (SIA) reported yesterday.

Sales were 7.2 per cent lower than the $22.4 billion in October 2008. Excluding memory products from the calculation shows a slower year-on-year decline of 4.8 per cent to $17.3 billion from $18.2 billion.

Sales for the first 11 months of 2008 were $232.7 billion, an increase of 0.2 per cent from the first 11 months of 2007 when sales were $232.2 billion. Excluding memory products, year-to-date industry sales increased 5.6 per cent.

''The worldwide economic crisis is having an impact on demand for semiconductors, but to a lesser degree than some other major industry sectors. We expect the industry will remain the second largest exporter in the US for 2008'' said SIA president, George Scalise.

''Not all segments of the industry are being affected equally by the downturn. The memory market which has been under severe price pressure throughout the year has seen sales decline significantly while many other product sectors have year to date sales above 2007 levels,'' Scalise added.

Scalise noted that the SIA has urged US Congressional leaders to move quickly to pass legislation that will strengthen consumer confidence and stimulate government and industry investment that will drive near term economic growth.

According to Gartner, Inc. worldwide semiconductor capital equipment spending is on pace to total $47.1 billion in 2008, a 25.7 per cent decline from 2007. In 2009, spending is expected to decline another 12.8 per cent and return to growth in 2010. These projections were down from Gartner's July forecast of a 19.8 per cent decline in spending for 2008. (See: Global economic squeeze leads 26-per cent decline in 2008 semiconductor capital equipment spending)