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Gartner Pessimistic About Chip Industry This Year

By - Source: Gartner | B 7 comments

Gartner reduced its forecast for the semiconductor industry from growth of 6.2% to only 5.1%.

The more conservative estimate is largely based on effects caused by the earthquake and tsunami in Japan, but it is not as dramatic as initially predicted.

"The disaster in Japan clearly had an impact on the semiconductor market, and supply chain behavior, 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."

Gartner now forecasts $315 billion of chip sales for the year. The reduction of predicted sales reflects third quarter "friction" and "residual effects" from the events in Japan. "However, once third-quarter trends are established and supply chain participants are satisfied that all issues are understood and production is normalized, we expect an effort to draw down inventory, which will weaken the semiconductor market in late 2011 and early 2012," Middleton said.

Further down the road, Gartner expects smartphone and tablets to drive semiconductor growth. Through 2013, two thirds of the growth will be fueled by the ultra-mobile segment, the firm said.

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  • -1 Hide
    alhanelem , June 24, 2011 10:47 PM
    that silicon wafer looks shiny... I WANT IT!!!
  • 0 Hide
    fir_ser , June 24, 2011 11:04 PM
    Japan’s earthquake had a big impact on many markets so it isn’t unexpected to affect the semiconductor market.
  • 5 Hide
    amk-aka-Phantom , June 24, 2011 11:18 PM
    "Further down the road, Gartner expects smartphone and tablets to drive semiconductor growth. Through 2013, two thirds of the growth will be fueled by the ultra-mobile segment, the firm said."

    For once, I wish that humanity's end WOULD happen in 2012 so that I don't have to see this misery. Though, who cares... can't run my games and other demanding programs smoothly - GTFO. Not everybody needs a fast desktop CPU, so let them settle for their "mobile" stuff, if that's what they want.
  • 0 Hide
    Lewis57 , June 25, 2011 8:57 AM
    amk-aka-phantom"Further down the road, Gartner expects smartphone and tablets to drive semiconductor growth. Through 2013, two thirds of the growth will be fueled by the ultra-mobile segment, the firm said."For once, I wish that humanity's end WOULD happen in 2012 so that I don't have to see this misery. Though, who cares... can't run my games and other demanding programs smoothly - GTFO. Not everybody needs a fast desktop CPU, so let them settle for their "mobile" stuff, if that's what they want.


    What the hell are you talking about? Just because you find no use for a smartphone or tablet doesn't mean they are useless. I have no use for a tablet but my folks seem to love them when it comes to easy portable browsing.

    To dumb what I am saying down for you, just because you like SUVs doesn't mean car manufacturers shouldn't make any other type of car.
  • 0 Hide
    JamesSneed , June 26, 2011 2:08 AM
    I think they are under estimating Bulldozer, Fusion, Sandy Bridge and the need for businesses to move off of Windows XP. I would like Douglass Perry to add a calendar reminder to check back in on 4th quarter to see if Gartner was right.
  • 0 Hide
    eddieroolz , June 27, 2011 6:19 AM
    The affected regions produced a sizable chunk of the semiconductor output of Japan, so this is expected.
  • 0 Hide
    jsc , June 27, 2011 12:24 PM
    Only 5.1% growth forecast ...

    Too bad the rest of the economy isn't growing at 5.1%.