Demand for PCs drives semiconductor sales

Strong PC demand helped fuel healthy growth in the sector and the semiconductor market during November 2007, but DRam memory prices continued to free fall.
The latest figures from the Semiconductor Industry Association (SIA) showed that worldwide sales of semiconductors rose to $23.1bn (£11.7bn) in November, an increase of 2.3 per cent from $22.5bn in November 2006. Sales increased by 0.7 per cent over October 2006. For the year to date, sales topped $231bn, 2.8 per cent up on the same period in 2006.
“Microprocessor sales increased by 5.8 per cent month on month and by 7.4 per cent from November of 2006,” explained SIA president George Scalise. “Strong PC unit demand contributed to a 2.6 per cent sequential increase in microprocessor unit shipments and a 3.2 per cent increase in average selling prices (ASPs). While unit demand has been very robust, average selling prices have declined in a number of key product segments.”
Scalise added that pricing pressure in the memory sector continues to affect industry sales. “DRam bit shipments, for example, increased by 25 per cent in the three months to mid-December, while ASPs declined by 20 per cent during the same period,” he explained.
Scalise added: “While total semiconductor sales continue on pace to surpass the record level of 2006, it will take very strong sales in December to meet our forecast of 3.8 per cent growth in 2007.
“Early indications are that consumer products with high semiconductor content such as LCD TVs and MP3 players, along with digital cameras, all sold well in the holiday buying season.”
In related DRam processor news, troubled memory maker Micron reported its fourth consecutive quarter of losses with a net loss of $262m on sales of $1.5bn for its first financial quarter of 2008. This was greater than the net loss of $158m it recorded in the same quarter last year.
Plummeting prices were blamed for the shortfall and according to Micron, even though unit shipments for DRam and Nand Flash rose considerably, prices fell 20 per cent and 30 per cent respectively. The losses come as Micron attempts to aggressively expand into the Nand Flash and solid state drive (SSD) market.
“We are feeling the effects of what was a pretty big expansion year in 2007,” commented Micron chief executive Steve Appleton. “Output is probably peaking.”
Semiconductors receive global sales lift