Things looking up for semiconductor market, says iSuppli

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While market watcher iSuppli has lowered forecasts for semiconductor and electronics revenues in 2009, things will start looking up in the second half, says the company.

Semiconductor revenues are likely to fall to $198.9 billion in 2009, down 23 percent from 2008, while electronics will drop nearly ten percent to $1.38 trillion in 2009.

"The global economy and technology industry have undergone a period of uncertainty and volatility," says iSuppli's Dale Ford. "With technology companies downgrading their forecasts, and with little visibility into future demand trends, conditions appear to be worse than previously expected in 2009.

"There were signs that the economic decline was becoming less pronounced near the end of the first half," adds Ford. "Even after trimming their expectations for the year, key semiconductor companies are entering the second-quarter financial reporting period with revenue guidance averaging 13 percent sequential growth compared to an overall revenue decline of 18.8 percent posted in the first quarter of 2009."

iSuppli says the automotive sector is pulling the market down, with the decline of worldwide automobile sales - particularly in North America - having a major impact on overall electronic equipment shipments. The company reckons the automotive electronics sector will drop to $75.2 billion, a whisker under 25 percent down on last year.

But the company estimates that global semiconductor revenues are set to rise by more than ten percent in the third quarter and by around five percent in Q4. At the same time, the electronics market is likely to experience growth of ten percent in Q3 and nine percent as the year draws to a close.

"The semiconductor industry will show improvements beginning in the fourth quarter of 2009, which will provide the basis for overall growth of 13.1 percent in 2010," concludes Ford. "Global electronic equipment revenues also will rise by 4.9 percent in 2010."