Global semiconductor market to reach $290 billion in 2010

INDIA: According to RNCOS, the global semiconductor market is expected to earn $290.5 billion in revenues this year, owing to the rising demand in emerging markets like India and China.

The Semiconductor Industry Association (SIA) has projected semiconductor firms to post revenues of around $290.5 billion in 2010, up 28 percent from 2009, reported by V3.co.uk. This prediction is supported by better than expected sales.

The Association also anticipates semiconductor sales to cross the mark of $300 billion, by growing 6.3 percent, in 2011 and subsequently reaching $317.8 billion in the following year. Interestingly, the recently projected growth is double that projected in November 2009.

The semiconductor sales grew 2.2 percent in April 2010 from the preceding month. The key contribution in this regard came from the adoption of 3G wireless communications around the world and the resultant infrastructure investment as well as revival in demand from the automotive, enterprise and industrial sectors.

Economic growth in emerging markets, especially India and China, will drive the semiconductor sales in coming years. This is because robust growth in the economies of these nations is leading to huge demand for IT products, which in turn, propels semiconductor demand. It is noteworthy that the IT industry has improved as the economies and consumer demand bounce back from recession. The industry was severely hit by the decline in discretionary spending during global recession.

The growth this year will also be stimulated by assiduous inventory and capacity management initiatives by chip manufacturers. In addition to this, advent of innovative technologies at the component and end-system levels will also fuel the growth.

As per “Semiconductor Industry Forecast to 2012”, a market research report by RNCOS, sales of integrated circuits (ICs) will dominate the semiconductor market worldwide by 2012, and the IC market is projected to grow at a CAGR of nearly 9 percent during 2009-2012. The sensors segment will witness the highest growth, owing to the strong demand for new solid-state lighting applications, touch screen panels and white light-emitting diodes (LEDs).

According to a research analyst at RNCOS: “In near future, the global semiconductor industry is expected to return to its previous seasonal patterns, as the economy, particularly in emerging markets, continues to recover. However, future prospects for the semiconductor market remain vague for regions such as Europe, North America and Japan.”