June 1, 2005 – The size of the global semiconductor market is expected to grow 6.3% in 2005 from the previous year to hit a record $226.53 billion on the back of strong demand for products for use in PCs and cellphones, according to a recent announcement by World Semiconductor Trade Statistics (WSTS). The previous record was $213.03 billion set in 2004.

By region, the market for the Americas is expected to shrink by 1.4% to $38.53 billion, while that for Europe is likely to grow by 5.2% to $41.46 billion, it said. The Japanese market is expected to expand 3.3% to $47.26 billion, with that for other countries in the Asia-Pacific region seen soaring 11.8% to $99.28 billion.

WSTS estimates the market will expand 5.2% in 2006 and 10.5% in 2007.

Demand for semiconductor chips has been slowing since autumn 2004 amid ongoing adjustments of inventories for cellular phones and digital consumer electronics. In the previous November report, WSTS forecast only a small 1.2% growth for 2005.

But the 2005 estimate was revised up as chip demand in January-March was higher than forecast and inventory adjustments for PCs and cellular phones appear not as deep as expected.

WSTS also sees demand for digital consumer electronics, such as flat-panel television sets, increasing in July-September, which will help boost the overall semiconductor market.