October 3, 2012 – Macroeconomic malaise continues to weigh down global semiconductor sales, although there’s a possible ray of hope for a boost by year’s end thanks to introduction of much-desired electronics devices (hello iPhone 5).
Worldwide sales of semiconductors in August were $24.30 billion, up just a fraction of a percent from the previous month (as they were in July), and down a couple of percentage points from the same month a year ago (also continuing the trend). For the year through August, chip sales are down about -4.6% to $189.46 billion. (The WSTS’ midyear forecast in June, which the SIA now "endorses" in lieu of its own numbers, projected a scant 0.4% increase in 2012.)
The regional sales map remained uneven in August, with month/month pullbacks in Japan and Europe, but a surprising rebound in the Americas — its first M/M growth period since April. Compared with a year ago though, the Americas is still showing weakness (around -9%).
"Global semiconductor sales have held steady in recent months despite strong macroeconomic headwinds, but these challenges have hampered growth," stated Brian Toohey, SIA president & CEO. He also urged "vigorous discussion" between the two US presidential candidates heading into the final weeks of the election period, to enact "government policies to reduce business uncertainty, accelerate the economic recovery and keep America at the forefront of innovation."
Barclays’ CJ Muse breaks down the SIA’s August numbers by device category and end market, determining that almost every sub-segment underperformed in the quarter except NAND thanks mainly to ASP declines. He also points out that with most industry watchers still holding out hope for even 1% growth in 3Q12 (and for the full year 2012), September’s chip sales would have to be gangbusters at 6% growth — and in recent days both Intel and TI have lowered their 3Q outlooks echoing softness (a $1B shortfall for INTC).
Analyzing end market demand, Muse notes that a weak back-to-school period pushed consumer chip sales into negative territory for the first time since the beginning of the year (-4.3% Y/Y), though there was a slight uptick in sales M/M thanks to ASPs.
Chip sales tracking is now entering the critical seasonal period of buildup to make electronics products for year-end holiday sales. And therein lies a ray of hope, at least for some vendors — there’s a new iPhone 5 hitting shelves, and reports of an iPad mini ahead, Muse notes.