Semiconductor market to slow down next year

Gartner and IDC say semiconductor growth rates in 2011 will pale in comparison to growth rates this year

Market research firms Gartner and IDC on Thursday said that worldwide semiconductor revenue will slow down next year, putting the brakes on the market's recovery this year from the recession.

Gartner is estimating worldwide semiconductor revenue to reach US$314 billion in 2011, growing by 4.6 percent, which pales in comparison to Gartner growth-rate projections for this year. Gartner this week said it expects worldwide semiconductor revenue this year to reach a "landmark" US$300.3 billion in 2010, up 31.5 percent from 2009, according to a preliminary study.

IDC is projecting a revenue growth rate of 9 percent year over year for 2011, though the company did not provide revenue projections. Semiconductor revenue could be hurt by high unemployment in the U.S. and "the ongoing Euro crisis," IDC said in a statement.

Next year's growth will be a "modest chip correction" of the market after the economic rebound in 2010, said Bryan Lewis, research vice president at Gartner, in a statement. The semiconductor revenue grew at a fast pace this year after revenue had declined by 10 percent in 2009, during the global recession.

Semiconductor revenue next year will be driven by growth in segments including NAND memory, which is used for storage in consumer electronics such as smartphones and tablets. NAND revenue growth is expected to grow by 24 percent next year, driven by the fast growth in shipments of mobile devices.

Semiconductor revenue from mobile phones in 2011 is expected to be $55.4 billion, growing year over year by 13.6 percent, Gartner said.

Revenue from DRAM is expected to decline by 2.4 percent next year, after seeing a resurgence in 2010 with growth of 49.8 percent, Gartner said. The prices of DRAM will fall, and revenue next year will be further hurt with the slowdown in PC purchases that started in the third quarter this year.

However, revenue for other PC semiconductor components such as CPUs will increase on higher average selling prices, Gartner said.

IDC said the PC segment will benefit from the launch of Intel's Sandy Bridge and Advanced Micro Devices' Fusion processors next year. That could help "accelerate the PC replacement cycle and drive semiconductor demand into 2012," IDC said.

Gartner said that overall semiconductor revenue from PCs next year is expected to be $62 billion, declining by 3.2 percent.

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags GartnerIDCComponentsprocessorsmemory

Struggling for Christmas presents this year? Check out our Christmas Gift Guide for some top tech suggestions and more.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Agam Shah

IDG News Service

Most Popular Reviews

Follow Us

Best Deals on GoodGearGuide

Shopping.com

Latest News Articles

Resources

GGG Evaluation Team

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Steph Mundell

LIFEBOOK UH574

The Fujitsu LifeBook UH574 allowed for great mobility without being obnoxiously heavy or clunky. Its twelve hours of battery life did not disappoint.

Andrew Mitsi

STYLISTIC Q702

The screen was particularly good. It is bright and visible from most angles, however heat is an issue, particularly around the Windows button on the front, and on the back where the battery housing is located.

Simon Harriott

STYLISTIC Q702

My first impression after unboxing the Q702 is that it is a nice looking unit. Styling is somewhat minimalist but very effective. The tablet part, once detached, has a nice weight, and no buttons or switches are located in awkward or intrusive positions.

Latest Jobs

Shopping.com

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?