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SIA: Record World Semiconductor Revenues in November

Jan 15 2014, 6:01pm CST | by

SIA: Record World Semiconductor Revenues in November
Photo Credit: Forbes
 
 
 

The Semiconductor Industry Association (SIA) announced this month that November world semiconductor sales compiled by the World Semiconductor Trade Statistics (WSTS) reached $27 billion, an increase of 6.8% over November 2012 sales of $26 billion and 0.6% higher than the previous month.  This was the ninth consecutive month of increasing sales.

SIA president and CEO Brian Toohey pointed out that 2013: “Is on pace for record revenue.”  What Toohey didn’t point out was that November revenues were the highest in the history of the market, as were those of September and October.  There’s a trend here, and that trend is very positive.

What has happened to make this market start to grow?  It’s simple, really.  This is the rising trend of a semiconductor cycle.  These cycles are driven by capital spending cutbacks about two years earlier.  Capital spending was trimmed in the second half of 2011, and this resulted in a capacity shortage in late 2013.

This post’s chart shows monthly revenues (blue) for the past 3 years.  and is excerpted from a more complex chart on the SIA website.  Revenues were at a plateau in 2011, when capital spending was reduced, and plunged in 2012 as the effects of an excess of capital spending in 2010 took hold.  The nine-month rise that started in March 2013 is a response to the capital spending reduction, and this rise should continue through most of 2015.

2014 will be a banner year for semiconductors, as I pointed out in a video posted by another semiconductor market research firm, VLSI Research.  The most visible increases will occur, as they always do, in the commodity memory markets, but all of semiconductors will see increases.  In Silicon Valley most executives use the timeworn saying: “A rising tide lifts all boats!”

Source: Forbes

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