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As the typically weakest quarter proved to be uncharacteristically strong, Gartner has revised upwards its global semiconductor forecast for 2010. Worldwide semiconductor revenue is now forecast to reach US$290 billion in 2010, a 27.1% increase from 2009 revenue of US$228 billion, according to the latest outlook by the market research firm. Previously, Gartner had projected growth of 19.9% for 2010.

"Sequential semiconductor growth has been very strong over the last five quarters, well above seasonal norms, and manufacturing capacity is tight" said Bryan Lewis, Research Vice President at Gartner. "Chip revenue growth is clearly outpacing system revenue growth and that is a concern. Gartner's new semiconductor forecast has below-average growth in the second half of 2010 as we are anticipating a minor correction to realign semiconductor sales with electronic system sales. Even with this minor correction, we are still expecting very strong growth and record semiconductor sales in 2010."

Gartner said it expected the semiconductor industry to show continued growth through its forecast period in 2014. It would surpass the US$300 billion mark in 2011, when the market is forecast to total US$307 billion.

The PC and mobile phone markets will account for about 40% of the semiconductor market's growth in 2010. PC processor revenue is now expected to grow 15.5%, up from 10.0% in the previous update.Strong PC growth coupled with rising DRAM prices is causing the 2010 DRAM market to surge 78%.Previously, Gartner had projected DRAM growth of 55% in 2010.

Gartner is now inline with forecasts from the likes of Future Horizons and IC Insights.