"Global supplier semiconductor stockpiles at the end of the second quarter stood at an unusually elevated 83.4 Days of Inventory (DOI)," IHS said in a press release. This is, in fact higher than the 83.1 DOI in the first quarter of 2008.
"For the semiconductor industry, wading into such potentially troubling territory - reminiscent of the dark days leading into the recession- could herald the beginning of a critical inventory adjustment period," said Sharon Stiefel, semiconductor analyst at IHS. "The correction is likely to take place during the next few quarters and will not be completed until mid-2012. As such, it will involve suppliers making a prolonged reduction in their inventory levels to avoid dangerous oversupply situations."
IHS also said that it is reducing revenue forecasts for the third quarter as "various indicators point to a stalling economy." Instead of a previously expected growth of 4.6 percent, the new forecast sees 2.9 percent growth in 2011, which is down from 32.4 percent in 2010.
