San Jose (CA) - Worldwide sales of semiconductors grew to $19.02 billion in November, an increase of 1.3 percent from the $18.8 billion in October, and an increase of 18 percent from the $16.12 billion in October of 2003, the Semiconductor Industry Association (SIA) said.
The semiconductor industry enjoyed another month of double-digit growth in November, which was driven by strong demand of microprocessors, digital signal processors, DRAMs, and flash memory, according to the SIA. While increased demand for microprocessors and DRAMs was expected because of higher PC sales in the holiday season, the wireless handset market gained momentum, as indicated by growth in DSP and flash memory.
"Capacity utilization declined modestly, but remains above 90 percent," said SIA's president George Scalise. "Actions taken by both customers and semiconductor manufacturers to address excess inventories in some market sectors appear to have been effective. We expect that excess inventories will not be a significant concern by the end of the first quarter of 2005," Scalise said.
Compared to October, sales were up in all geographic regions except the Americas, where sales declined by 1.6 percent $3.45 billion from October. Europe increased sales by 4.2 percent to $3.61 billion, Japan by 0.8 percent to $3.91 billion and Asia-Pacific by 1.5 percent to 8.05 billion.
For 2005, forecasts of several analysts suggest that the semiconductor industry will face declining sales. The SIA itself expects a cyclical change of sales for 2005 with revenues to remain flat on 2004's levels which are projected to reach a new record level $214 billion for the year. For 2006, the SIA forecasts revenues to grow by 6.3 percent and 2007 by 14.2 percent to $259 billion.