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Global semiconductor revenue at $315 bn in 2011

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Press Trust of India Bangalore

Worldwide semiconductor revenue is projected at $315 billion in 2011, a 5.1% rise from the previous year's revenue of $299 billion, according to IT research and advisory firm Gartner.

This is down from Gartner's previous projection of 6.2% growth this year.

The earthquake and tsunami in Japan raised concerns about the supply of silicon wafers, batteries, crystal oscillators, packaging and other specialised materials. However, supply constraints due to the situation in Japan have not derailed the electronics industry, Gartner said.

"The disaster in Japan clearly had an impact on the semiconductor market and supply chain behaviour, but it is less than initially feared," said Peter Middleton, principal research analyst at Gartner.

 

"In response, in the last two weeks of March, vendors stepped up efforts to secure supply in the face of uncertainty and potential shortfalls — leading to some double ordering which continued into the second quarter. We think vendors were cautious with their second quarter guidance, and we expect the majority will exceed those estimates," he said.

"Although the impact is less than feared, we are anticipating some residual effects in the third quarter of 2011, as friction in the supply chain may impact some production and some surprises may occur," Middleton said.

"However, once third-quarter trends are established and supply chain participants are satisfied that all issues are understood and production is normalised, we expect an effort to draw down inventory, which will weaken the semiconductor market in late 2011 and early 2012."

Gartner forecasts worldwide application-specific standard product (ASSP) revenue to reach $79.7 billion in 2011 and $99.4 billion by the end of 2015.

With Apple's application-specific integrated circuit (ASIC) investment and a commanding grip on popular mobile devices, the ASIC market would experience solid growth through 2015.

The highest overall growth through 2015 is coming from non-optical sensors, which are primarily driven by automotive applications, but high growth is coming from increased sensor use in applications outside automotive, especially, smartphones, tablets and video game hardware.

Gartner analysts said they were witnessing rapid semiconductor growth in the smartphone and media tablet categories. Through 2013, two-thirds of semiconductor industry revenue growth would come from smartphones and tablets.

"One critical trend is the introduction of new generation of high-performance mobile application processors, which form the heart of both smartphones and media tablets," said Jon Erensen, research director at Gartner.

"These high-end processors, combined with higher amounts of DRAM and NAND flash memory, will enable the performance and storage required for advanced new applications, including context-aware computing, augmented reality and computational photography," he said.

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First Published: Jun 21 2011 | 6:51 PM IST

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