Saturday, November 7, 2009

Top 20 suppliers' sales show back-to-back 19 percent growth rates!

SCOTTSDALE, USA: Third quarter sales results from the top 20 semiconductor producers illustrate once again why IC Insights has, since the beginning of this downturn, encouraged its clients to think quarterly about 2009! As shown below, the semiconductor industry continues to move through this silicon cycle very quickly as it recovers from recession.

4Q08 — The beginning of the downturn/collapse
1Q09 — The bottom of the cycle
2Q09 — Inventory replenishment phase
3Q09 — Strong seasonal demand
4Q09 and beyond — Market growth will mirror the health of the worldwide economy and electronic system sales

As shown in Fig. 1, the top 20 semiconductor companies, in total, registered a 3Q09/2Q09 sales increase of 19 percent. This followed the strong 19 percent increase logged by the top 20 suppliers in 2Q09/1Q09!

In 3Q09, the DRAM and NAND flash markets surged and helped Toshiba and Hynix post 3Q09/2Q09 sales increases of 30 percent and 31 percent, respectively.

Fig. 1 shows the top 20 semiconductor companies ranked by sales through the first three quarters of 2009. If only 3Q09 figures were used, Freescale would drop out of the ranking and be replaced by Japanese DRAM supplier Elpida, which had 3Q09 sales of $1,025 million (an increase of 38 percent over its 2Q09 sales).

As will be discussed in IC Insights' November Update to The McClean Report, even though 2009 will go down as one of the steepest downturns in semiconductor history (-12 percent), four of the top 20 companies are expected to register higher sales in 2009 than in 2008.

Using company guidance as well as IC Insights' forecasts for 4Q09 semiconductor sales levels, Samsung, Toshiba, Qualcomm, and MediaTek are expected to show sales growth this year.

Quite an accomplishment considering that 2009 is likely to be the worst recession to hit the worldwide economy in 63 years!Fig. 1
Source: IC Insights, USA

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