Global semiconductor sales fall 5.4 per cent
11 Apr 2009
The global recession continues to batter the worldwide semiconductor industry, whose sales fell 5.4 per cent to $255 billion in 2008, a decrease of $14.5 billion from 2007 revenue, due to the steep decline in the market in the final quarter of 2008 and could face far worse declines in the current year.
With consumers reducing their spending on computers and cell phones, chip makers are forced to prune down on capacity in plants in order to adapt to the reduced demand during the global economic slowdown.
Releasing its annual semiconductor market share analysis, IT market research and analyst Gartner Inc, ''While sales held up fairly well in the first half of 2008, in the third quarter the industry started to soften as the economy slowed, and by the fourth quarter sales were deteriorating quickly, causing revenue growth to go into negative territory,'' said Peter Middleton, principal research analyst at Gartner. ''With the market heavily impacted by the recession, we can expect considerable market consolidation going forward.''
Intel held the top position for the 17th consecutive year, increasing its market share to 13.3 per cent in 2008. Although it had sales of $33.8 billion, its revenue declined by 0.5 per cent, a consequence of spinning off it's NOR flash memory business.
The company outperformed the industry average due to the strong performance of its notebook business in which the company gained share throughout the year.
Samsung was in second position, with revenue of $17.3 billion, saw its revenue decline 15 per cent in 2008 as the company's main product lines, DRAM and NAND flash experienced sharp price declines caused by excess supply in the market during 2008.
Toshiba, in the third position, saw its revenue decrease 10.3 per cent, largely because its application-specific integrated circuit (ASICs) and application-specific standard products (ASSPs) for consumer, wireless and automotive electronics showed mild growth in early 2008.
The best performer among the 2008 top10 in Gartner's market share analysis was Qualcomm, with growth of 15.3 per cent and revenue to $6.4 billion. This growth was driven by a strong first three quarters of the year, but Qualcomm felt the impact of the economic downturn in the fourth quarter of 2008.
With revenue during the first quarter of the current year being $45.2 billion, a drop from $65.5 billion in last year's first quarter, Gartner predicts a significant year-over-year revenue drop for 2009.Top 10 Worldwide Semiconductor Vendors by Revenue Estimates (US millions)
| 2008 | 2007 | Company | 2008 Revenue | 2008 Market Share (%) | 2007 Revenue | 2007-2008 Growth (%) |
| 1 | 1 | Intel | 33,814 | 13.3 | 33,988 | -0.5 |
| 2 | 2 | Samsung Electronics | 17,391 | 6.8 | 20,464 | -15.0 |
| 3 | 3 | Toshiba | 10,601 | 4.2 | 11,820 | -10.3 |
| 4 | 4 | Texas Instruments | 10,593 | 4.2 | 11,768 | -10.0 |
| 5 | 6 | STMicroelectronics | 10,270 | 4.0 | 9,966 | 3.1 |
| 6 | 5 | Infineon Technologies (Including Qimonda) | 8,461 | 3.3 | 10,194 | -17.0 |
| 7 | 8 | Renesas Technology | 7,081 | 2.8 | 8,001 | -11.5 |
| 8 | 11 | Qualcomm | 6,477 | 2.5 | 5,619 | 15.3 |
| 9 | 7 | Hynix Semiconductor | 6,010 | 2.4 | 9,100 | -34.0 |
| 10 | 12 | NEC Electronics | 5,770 | 2.3 | 5,593 | 3.2 |
| Others | 138,545 | 54.3 | 143,029 | -3.1 | ||
| Total | 255,013 | 100.0 | 269,542 | -5.4 |
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