The Semiconductor Industry Association (SIA) has released its 2002-2005 annual forecast. It says the worldwide semiconductor market will increase by only 1,8% in 2002 and 19,8% in 2003. However, the semiconductor trade group was more bullish for 2004, projecting 21,7% growth for that year. The SIA's previous forcast in June projected the worldwide semiconductor industry to grow by 3,1% this year, and revenues to pick up at an even faster pace over the following two years.
"The long-awaited recovery is under way," said W.J. Sanders III, AMD chairman, who presented the report. "We believe the next several years will see steady growth following the industry's steepest-ever decline in 2001." Sanders noted that worldwide semiconductor sales are now projected to surpass the peak revenues of 2000 in 2004. "It is now clear that 2000 was a bubble that distorted the industry's compound annual growth rate, pushing it above 16%," he said.
"We believe that compound annual growth rates in the range of 8-10% will be the norm going forward over the longer term," he said. "This will represent a sea change for our industry. We can no longer count on the proverbial rising tide that lifts all boats."
Predictions in categories
Total semiconductor: The total semiconductor market is expected to experience a slight increase in sales in 2002 of 1,8% to $141 bn. In 2003, the SIA forecasts growth of 19,8% to $169 bn, 22% to $206 bn in 2004, and then remain flat at $206 bn in 2005.
Discrete components: These include power transistors and RF solutions that are found in wireless consumer products. This segment is forecast to remain essentially flat in 2002 with 2,2% growth to $12 bn. Discretes are then forecast to grow 11% to $14 bn in 2003, 16% to $16 bn in 2004, and 1,3% to $16 bn in 2005.
Optoelectronics: This market includes laser devices, image sensors, and products that are frequently used in communication applications. In 2002, this market is expected to decline 7,0% to $7 bn in sales, but then grow 18% to $8,1 bn in 2003, 17% to $9,5 bn in 2004, and 10% to $10 bn in 2005.
Analog: Consumer and automotive application-specific analog products play an important role in this sector. The largest end-use driver of analog includes the upgraded telecommunications networks for Internet service and digital telecom technologies. Analog is expected to grow 3% to $24 bn in 2002, 19% to $28 bn in 2003, 22% to $35 bn in 2004, and 5,2% to $36 bn by 2005.
Application specific: Application specific standard products (ASSP) include consumer, computer and peripheral, communications, automotive, and industrial and other markets. After declining over 27% in 2001, the ASSP market is poised for growth. In 2002, ASSP should grow 5,7% to 15 bn, and then increase 18% to $17 bn in 2003 and 21% to $21 bn in 2004. 2005 is expected to have slow growth of 5,4% to $22 bn in sales.
MOS logic: The global logic market includes standard logic, standard cell, field programmable logic devices (FPLD), and a broad variety of application-specific products. In 2002, MOS Logic is expected to decline 3,1% to $32 bn, however, increase 16% in 2003 to $37 bn, 19% to $44 bn in 2004 and 7,8% to $47 bn in 2005.
MOS micro devices: This broad product category includes microprocessors, microcontrollers and digital signal processors. In 2002, this product sector is forecast to grow 2,8% to $38 bn, 18% to $45 bn in 2003, 16% to $52 bn in 2004, and 5,9% to $55 bn in 2005.
Microprocessors: Microprocessors will remain nearly flat in 2002 with 1,9% growth to $24 bn and then forecast to grow 12% to $27 bn in 2003, 14% to $30 bn in 2004, and 4,6% to $32 bn in 2005.
Microcontrollers: The global microcontroller market, driven by consumer and automotive applications, will experience a slight decline in 2002 before it sees growth in 2003. It is forecast that this sector will decrease 0,2% to $9,6 bn in 2002, and then grow 25% to $12 bn in 2003, 12% to $13 bn in 2004, and 5% to $14 bn by 2005.
Digital signal processors: DSPs can found in wired and wireless communications applications. This market is forecast to increase in sales 15% to $4,9 bn in 2002, 33% in 2003 to $6,5 bn, 29% to $8,4 bn in 2004, and 12% to $9,4 bn in 2005.
MOS memory: This market, which includes DRAMs, Flash, SRAMs, and EPROMs, continues in its historical volatile patterns. Sales in this product sector will be led by the DRAM market, followed by Flash. In 2002, the MOS Memory market is forecast to grow 8,2% to $27 bn, 33% to $36 bn in 2003, and 35% to $48 bn in 2004. By 2005, this market is expected to incur a cyclical downturn with a decrease of 21%, sales down to $38 bn.
DRAM: No one segment more clearly demonstrates the cyclical nature of the global semiconductor market than DRAMs, but DRAMs, which were once used almost entirely in computers, are now being found in a broad number of consumer and communication applications. The DRAM market is expected to grow 35% to $15 bn in 2002, 35% to $20 bn in 2003, and 43% to $29 bn in 2004. In 2005, DRAMs are forecast to decrease 29% to $21 bn in sales.
Flash: Like other memory product, Flash incurs high volatility. Flash products can be found in communications and digital photography applications. In 2002, this market is expected to remain flat at 0,7% to $7,7 bn, grow 39% to $11 bn in 2003, and 28% to $14 bn in 2004. In 2005, however, Flash is expected to decline 9,1% to $12 bn in sales.
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