October 1, 2007 – Tightening supplies and better pricing in NAND flash memory drove a nice spike in overall chip sales in August, according to data from the Semiconductor Industry Association (SIA), which showed Asia ramping up again, but the US still behind the curve.
Global semiconductor sales (based on a three-month moving average, to smooth out market peaks/valleys and SIA members’ different fiscal calendars) totaled $21.52 billion, its best performance since December, representing growth of 4.5% vs. July, and 4.9% from August 2006.
“Normal seasonal patterns” got partial credit from SIA president George Scalise, though a major factor was a 19% spike in NAND flash sales vs. July (and 48% Y-Y). “August is historically the beginning of the holiday season build by electronics manufacturers, which in turn drives demand for a broad range of semiconductor products,” he noted, in a statement.
Scalise pointed to recent analyst upgrades of projected growth in PC sales to 13% from 11%, noting that PC sales is “very solid” driven by emerging markets, which demand lower-cost PCs with lower silicon content. Cell phones are also selling well, he noted, and unit sales should top 15% for all of 2007, better than the SIA’s initial projection of 10%, thanks again to cheaper units being sold in developing markets (e.g. India, China) as well as in more established markets such as Europe and the US.
Looking at August sales on a regional basis, growth across most regions appears to be on an upswing, with one notable exception. Growth vs. July was best in the Asia-Pacific (nearly 6%), with all other regions seeing minor increases of around 3%. Year-on-year, Asia jumped 9.4%, roughly twice the rates of Europe (5.3%) and Japan (4.6%). The US, meanwhile, continued to lag, with a Y-Y decline of 6.2% — the eighth straight month of monthly Y-Y declines…that’s every month so far in 2007.
The SIA’s tally of actual chip sales again showed even better growth coming out of Asia (9.9% M-M, 12.5% Y-Y), with growth of around 4%-7%, both M-M and Y-Y, for other regions as well as total actual sales. Again, the lone underperformer is the Americas, with a -1.2% M-M decline in August chip sales, and a 10% drop Y-Y.
Worldwide semiconductor sales*, August 2007
(US $B)
Market……..Current month……..vs. prior month (%)…………….vs. year-ago (%)
Americas…………….3.59……………………3.48 (3.0%)……………………3.83 (-6.2%)
Europe………………..3.38……………………3.29 (2.9%)…………………..3.21 (5.3%)
Japan………………….4.10……………………3.96 (3.5%)……………………3.92 (4.6%)
Asia Pacific………..10.46……………………9.88 (5.9%)……………………9.56 (9.4%)
TOTAL………………21.52………………….20.61 (4.5%)…………………20.31 (4.9%)
Market…………….Jun/Jul/Aug…………….Mar/Apr/May (%)
Americas……………………3.59……………………3.34 (7.2%)
Europe……………………….3.38……………………3.27 (3.5%)
Japan…………………………4.10……………………3.95 (3.7%)
Asia Pacific……………….10.46……………………9.75 (7.3%)
TOTAL……………………..21.52………………….20.31 (6.0%)
* Based on three-month average
Source: SIA