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IHS cuts semiconductor forecast to 1.2%

17 November 2011 | By Mark Osborne | News > Fab Management

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Rare to see a semiconductor forecast in this very low range, market research firm, IHS has revised 2011 figures to indicate growth of barely 1.2%, down from its previous forecast in September of 2.9%. Apparently, the lowered figure is still something the industry should take a positive considering the wider macro economics at the moment, according IHS.

 “Although the forecast of 1.2 percent revenue growth in 2011 is just barely positive, an expansion of any magnitude is significant from the standpoint of market psychology,” said Dale Ford, senior vice president, electronics market intelligence for IHS. “Given the worsening economic environment and growing pessimism in the electronics supply chain, many market forecasters had projected third-quarter revenues would decline, and pull down the results for the full year of 2011. Even the prospect of marginal growth casts a much more optimistic light on the market performance for the year.”

IHS said that while third-quarter revenue increased, conditions have been worsening in the last three months of the year. Revenue is projected to decline by 2% sequentially in the fourth quarter. Many major semiconductor suppliers are projecting fourth-quarter revenue declines that average in the high single digits, according to the market research firm.

IHS noted that the primary market weighing down the semiconductor market is memory. DRAM, SRAM, NOR Flash memory—along with digital signal processors – are expected to generate revenue declines of 15% or more in 2011 and not much better in 2012 as all segments including NAND flash memory are projected to decline.

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