CUPERTINO, CALIF. – Many people in the semiconductor industry have been waiting until the first quarter of 2002 to try to get some idea of where the industry is headed. With the uncertainty of year-end consumer business as well as the continuing military conflicts around the world, forecasting is an especially difficult business.

There is some cautious optimism from the analysts, though, with several saying that there are signs of an upswing this year. Most notably, Advanced Forecasting (AFI) announced that its “IC Recovery Index” was pointing in a positive direction at the beginning of the year. David Crume of AFI said, “This situation resembles July 1998, when the same model accurately identified the minimum point of the 1998 recession.”

AFI prides itself on quantitative models that have predicted the volatile industry over the years. Crume did point out, however, that “the economic factors that determine the rate of recovery in 2002 are less favorable than they were during the 1999 recovery.” This suggests that the upcoming upswing will be less steep than the previous one.