2012 semiconductor spending forecast nearly doubled at Gartner

March 13, 2012 — Worldwide semiconductor revenue is projected to total $316 billion in 2012, a 4% increase from 2011, according to Gartner Inc. This outlook is up from Gartner’s previous forecast, made in Q4 2011, for 2.2% growth.

Expect a semiconductor industry "rebound," starting in Q2 2012, said Bryan Lewis, research vice president at Gartner. "The inventory correction is expected to conclude this quarter, foundry utilization rates are bottoming, and the economic outlook is stabilizing." The more upbeat 2012 forecast "assumes the European debt issues stay contained, Iran/Israel tensions stay in check, and solid growth from China," cautioned Lewis.

In the memory sector, DRAM pricing is expected to improve beginning in Q2 2012. The DRAM market will show a slight revenue increase in 2012 (up 0.9% year over year) after being the worst-performing market (-25%) in 2011. DRAM prices were down about 50% in 2011, and Gartner analysts expect pricing to rebound in part due to Elpida filing bankruptcy protection. NAND flash memory, however, is one of the fastest-growing device types in 2012, with revenue forecast to grow 18%. Analysts attribute the NAND flash growth to a strong increase in mobile consumer devices and solid-state drives.

End markets:
Media tablet unit production is forecast to increase 78% over 2011, and semiconductor revenue from media tablets will reach $9.5 billion in 2012. Quad-core processors and higher-resolution displays will be mainstream for tablets in 2012.

PC unit production in 2012 is projected to increase 4.7%, and semiconductor revenue from PCs will reach $57.8 billion.

Mobile phone unit production is expected to grow 6.7%, with semiconductor revenue for mobile phones totaling $57.2 billion in 2012. Gartner analysts said that further innovation focused on location and context will require advances in sensing, processing, displays, connectivity and power efficiency.

Gartner, Inc. (NYSE:IT) is a leading information technology research and advisory company. For more information, visit www.gartner.com.

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