May 6, 2004 – According to the latest data from the Semiconductor Industry Association (SIA), chip sales in 1Q04 — typically a slow post-holiday period — blew the doors off of historical norms.

Worldwide chip sales (a three-month moving average) rose 4.4% to $16.28 billion in March, up from $15.58 billion in February and a 32.3% increase from March 2003. Year-on-year, sales growth achieved a 3.5-year high, besting February’s 30.7% mark. For the first quarter, global sales were $48.8 billion, up 34% from 1Q03 — and also up 1.4% from the seasonally strong 4Q03, indicating the current strength of the chip industry.

Continued growth in corporate IT spending helped boost the numbers, with an 11.5% rise in IT software and hardware investments, the third consecutive quarter of double-digit growth. Sales of microprocessors and DRAMs were up 5.3% and 5.9% respectively in March; programmable logic devices rose 12.9% and application-specific standard products (ASSPs) rose 8.4%.

All geographic regions showed strong month-on-month gains, after small increases and declines in February. The three-month moving average, however, showed single-digit increases for the Americas and Europe, and a 3% dip in Japan. So far this year, all regions are enjoying growth rates above 24%, led by Asia-Pacific at 45.8%, for an overall 32.3% year-to-year growth clip.

“The fundamentals are in place for continued robust growth through the end of the year,” said SIA president George Scalise, adding that “it now appears likely that growth for 2004 will exceed 20%.”