Extreme results expected in 2011 semi market forecast to grow 2 percent!

SCOTTSDALE, USA: Although low single-digit growth is forecast for the total semiconductor market this year, there are several companies expected to register results that are quite different (see Fig.).

Qualcomm, spurred by a smartphone market that is forecast to jump 73 percent this year, is expected to log a strong 33 percent increase in semiconductor sales in 2011! However, at the other end of the spectrum is Elpida, which is forecast to register a sales decline of 39 percent (a decline that is likely to be close to 50 percent when expressed in yen)!

In total, the top 20 semiconductor suppliers are forecast to display a 6 percent increase in 2011 sales as compared to 2010. This growth rate is four points greater than the 2 percent increase forecast for the total worldwide 2011/2010 semiconductor market. A forecast of the 2011 top semiconductor suppliers will be included in IC Insights' November Update, which is part of the subscription to The McClean Report.Source: IC Insights, USA.

As shown in the figure, Intel is expected to remain firmly in control of the number one spot in the ranking this year. In fact, Intel, helped by its acquisition of Infineon's wireless IC business, is forecast to extend its lead over second-ranked Samsung by registering a 47 percent higher semiconductor sales level than Samsung in 2011 as compared to a 24 percent margin in 2010.

Healthy growth in its graphics and communications processor business is forecast to help Nvidia jump five positions and move the company to 18th place in the top 20 ranking. In contrast, Elpida is expected to fall six spots in the ranking this year (from 13th to 19th) as the collapse in the DRAM market is having a pronounced negative effect on the company (Elpida lost $629 million in 3Q11).

Unlike last year, the memory companies are not expected to secure the top growth rate positions in the ranking in 2011. In fact, as shown below, the top seven 2011/2010 semiconductor sales growth rate increases are forecast to be logged by non-memory suppliers. As shown, since all of the figures are converted to US dollars, the weak US dollar in 2011 is expected to spur double-digit growth at Sony, Fujitsu, and TSMC.

1) Qualcomm; 33 percent jump due to surging smartphone IC sales.
2) Infineon; 30 percent growth from continuing operations (24 percent using 2010 exchange rates).
3) Intel; 26 percent increase spurred in part by its acquisition of Infineon's wireless business.
4) Sony; 16 percent growth (6 percent using 2010 exchange rates).
5) Fujitsu; 11 percent increase (1 percent using 2010 exchange rates).
6) Nvidia; 11 percent growth due to healthy sales of graphics and communications processors.
7) TSMC; 10 percent (2 percent using 2010 exchange rates).

Of the big five memory suppliers in the top 20 ranking (i.e., Samsung, Toshiba, Hynix, Micron, and Elpida), only Samsung and Toshiba are expected to register 2011/2010 growth. In total, 11 of the top 20 suppliers are forecast to outperform the total worldwide semiconductor industry 2011/2010 growth rate of 2 percennt (including Infineon's 30 percent sales growth from continuing operations).