February 2, 2007 – Global sales of semiconductors rose 8.9% to a record $247.7 billion in 2006, driven mainly by a host of consumer-oriented end products including cell phones and HDTV sets, according to final tallies by the Semiconductor Industry Association (SIA).
Chip sales in December fell 3.6% from the prior month, per the usual rampup to meet holiday demand, but were up 9% from December 2005. Sales for the entire fourth quarter were also up 9% year-on-year, and 1.9% vs. 3Q06, to $65.2 billion.
SIA President George Scalise pointed to growth driven by cell phones, MP3 players, and HDTV sets, all of which are seeing lower costs and improved functionality due to increased use of semiconductor technology. He cited iSuppli figures that semiconductor content of electronic systems now stands at 21.6% of total system cost, and is “increasing steadily.”
Average semiconductor content in a cell phone fell slightly to around $40 amid rising demand for lower-end phones, but overall cell phone shipments exceeded one billion units, Scalise noted.
Sales for MP3 players slowed as well in 2006, but their semiconductor content is rising due to increased storage capacity and functionality such as video, he added. HDTV unit shipments in the US more than doubled, he noted, due to falling prices and more programming choices, and sharp growth is expected for the next several years.
PC sales growth has slowed as developed regions become saturated, but still accounts for a significant portion of semiconductor consumption, he added.
Also contributing to semiconductor growth are favorable economic conditions, including a 3.4% GDP increase, strong consumer confidence and spending, and still-heavy semiconductor sales in the Asia-Pacific, which led all regions with 12.7% growth in 2006, Scalise said.
The SIA also pointed to a balance of supply/demand thanks to a steady ratio of capital expenditures to sales, currently at ~22% (citing figures from Strategic Marketing Associates).
“With generally healthy economic conditions in all of the world’s major semiconductor markets, we believe our forecast of 10 percent growth to $273.8 billion in worldwide sales in 2007 is aligned,” he stated.
Chip sales, December 2006 (US $B)
Market……………. Current month….vs. prior month….vs. year-ago
Americas………………..3.80………………..-4.2%………………..2.5%
Europe…………………..3.50………………..-5.1%………………..5.4%
Japan…………………… 3.88………………..-5.4%………………..7.1%
Asia Pacific…………… 10.57………………..-2.1%……………… 13.6%
TOTAL………………….21.74………………..-3.6%………………..9.0%
Chip sales, three-month moving average (US $B)
Market……………. Jul/Aug/Sep…. Oct/Nov/Dec…… % change
Americas………………..3.89………………..3.80……….-2.3%
Europe…………………..3.41………………..3.50………. 2.5%
Japan…………………… 4.02………………..3.88……….-3.7%
Asia Pacific…………… 10.02…………….. 10.57………. 5.5%
TOTAL………………….21.34…………….. 21.74………. 1.9%
Major product line summary (US $B)
Product………………….. 2005…………. 2006……… % change
Discrete…………………………15.2………….. 16.6………….. 9.2
Optoelectronics……………… 14.9………….. 16.3………….. 9.4
Analog…………………………..31.9………….. 36.9………….15.7
MOS microprocessors……… 35.0………….. 33.2…………..-5.1
MOS microcontrollers……….12.1………….. 12.4………….. 2.5
MOS DSP…………………………7.6……………..8.3………….. 9.2
MOS logic…………………….. 57.7………….. 60.2………….. 4.3
MOS DRAM…………………….25.6………….. 33.8………….32.0
Flash EEPROM………………..18.6………….. 20.1………….. 8.1
——————————————————-
TOTAL…………………………218.6………….237.8………….. 8.8
WaferNEWS source: WSTS/SIA