Low market demand maintains high levels of semiconductor supplier inventory

According to Gartner, an international research and consulting agency, global semiconductor industry revenues have slowed in 2011, with annual revenue forecast at US$299 billion, a decrease of 0.1 percentage points from 2010; the agency’s outlook report in the second quarter The global semiconductor industry's annual growth rate of up to 5.1%, this time is the second time this year, revised the forecast figure.

Bryan Lewis, vice president of research at Gartner, said: “The three factors shaping the short-term outlook for the semiconductor industry include overstocking, excess manufacturing capacity, and slowing demand caused by the economic downturn. Semiconductor manufacturers’ financial forecasts for the third quarter are all lower than quarterly averages. The current supplier’s financial forecasts also point to a slowdown in growth in the third quarter. In principle, we believe that the growth rate in the third quarter will be at 8% due to sales in the opening season and production preparations for the Christmas sales season. ~9%. The supply chain also showed a significant slowdown, and semiconductor-related inventory levels remained high."

PC production growth has declined significantly. In the previous quarter, Gartner forecasted that PC production will grow by 9.5%, which was revised down to 3.4% last time. In Gartner’s latest forecast, the growth rate of mobile phone production was also revised down from 12.9% in the second quarter forecast to 11.5%. The DRAM industry was hit hard by the decrease in PC demand and the drop in price; Gartner forecast that the DRAM industry will decline by 26.6% in 2011. NAND flash memory and data processing application-specific integrated circuits (ASICs) are the fastest-growing areas this year, with an annual growth rate of about 20%, driven by smartphones and iPads.

Lewis said: “The outlook for 2012 is unclear. As the overall economic environment continues to deteriorate, we have revised down the forecast for 2012 semiconductor revenue growth rate from 8.6% to 4.6%. However, the US economy is fearful of falling into a secondary recession. The increase in sales has raised fears of further decline in sales. Gartner is closely watching the signs of significant weakness in IT and consumer sales trends."