July 28, 2010 – As if the enthusiastic industry didn’t already know 2010 was a great year here’s more evidence. Global semiconductor sales will increase by a whopping 30% vs. 2009 to $70B (to a total of $310B), the highest year-on-year increase ever, according to IC Insights. That beats the $59B (22%) surge in 2000. And the 30% growth rate in 2010 if fulfilled (and some, including IC Insights’ Bill McClean, think it might be higher) would come in sixth all-time, with 2000’s 37% still on top.
Most of that $72B added to the industry this year will be quickly converted into capital spending, McClean et al predict. 2010 semiconductor industry capital spending will surge 83% to >$47B.
What’s behind the large surge this year, besides being compared to a terrible 2009? It’s not macroeconomic growth — worldwide GDP is expected to be 3.9%, close to its long-term 3.6% trendline. "The real driving force," they say, are the standby chip end-markets: PCs and phones (specifically smartphones). PC unit volumes are expected to grow at least 18% this year to 338M; smartphone unit sales will surge 21% to 275M. And both segments are expected to see at least 10% higher unit volume shipments in 2H10 vs. 1H10 — a return to seasonality, e.g. the traditional back-to-school and holiday build ramps. McClean told SST that he predicts a 7% increase in 3Q10 sequentially, but then a -4% decline in 4Q10 "as the holiday season (at least for ordering ICs) winds down, and a -2% decline in 1Q11 along with the typical seasonal lull. "We believe that the industry will revert to more "normal" patterns during 2011," he said.
|Top 10 semiconductor market increases in history. (Source: IC Insights)|