Chip sales rose in May

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Sales of semiconductors worldwide rose by 5.4 percent in May, compared to the previous month.

The Semiconductor Industry Association (SIA), said revenues worldwide for May amounted to $15.6 billion.

But while that is somewhat encouraging, compared to May last year, sales fell by 23.2 percent. In May 2008, revenues amounted to $21.5 billion. The figures are based on a three month moving average.

George Scalise, president of the SIA, said that the May numbers are the third consecutive month of sequential growth. "The sequential monthly increases lead us to be cautiously optimistic about a return to normal seasonal patterns," he said. "As consumer confidence returns and the economy resumes growth, we expect the industry to reflect those patterns."

Growth in Europe was flat, at 0.4 percent, but Japan and Asia Pacific showed a rise of 7.2 percent and 6.7 percent respectively.

Bruce Diesen, a chip analyst at Carnegie Securities Research, said that memory and LCD chips improved, compared to April. He predicts a 15 percent drop in world semiconductor dollar sales this year.

PC processor chips were flat - while volumes improved versus April, the mix was weaker, meaning more netbooks were sold, said Diesen.

Sales of DRAM rose, but from a very weak position, while NAND memory fell. Sales of GSM base station chips fell sharply, he said. Chips for cars were weak in May, reflecting the hit the automotive industry is taking.

Rising average selling prices (ASPs) for the more important cell phone semiconductors indicate a move towards high end phones in the month.