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Semico forecasts another gloomy year for chip biz

Statistical model points to weakness

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The flat or declining sales seen by some of the world's leading chip companies during the first three months of the year could be the first sign that 2003 isn't going to be a good year for the semiconductor industry.

That's certainly what market researcher Semico believes, based on its statistic modelling of the business. The company's Inflection Point Indicator (IPI) models the state of the market and provides an indication of the industry's health six to nine months down the line.

From December 2002 to this past February, the IPI has given a negative result - that, says Semico, points to industry instability, and the company is now considering revising its forecasts downward.

Back in March, Semico was bullishly declaring 2003 revenue growth of 23 per cent to $173 billion, and 17 per cent unit growth to 396 billion units. Both figures were well above similar forecasts from rival market researcher Dataquest.

The Semiconductor Industry Association (SIA) is currently forecasting double-digit growth in the latter half of the year. But if March's sales figures yield a further negative IPI, claims Semico, then that means 2003 will be another poor year. A positive IPI, on the other hand, holds the prospect that the SIA's predictions may be realised.

Yesterday's results from Intel, IBM and Motorola, and the SIA's own figures for February - sales declined 3.3 per cent over January, it said - suggest that Semico's March IPI isn't going to point to an upturn. The SIA's March figures are not due until the end of this month. Semico hasn't said when it will reveal its March IPI. ®

Related Stories

Motorola chip unit slides into red
IBM chip sales and margins static
Intel sales flatter than a pancake
Chip sales slide as recovery 'stalls'

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