After record 2004, another semiconductor slump for 2005
26 January 2005
News
The ever-cyclical semiconductor industry is entering another slump, with 2005 expected to be a down year with revenue declining by 5,7% to $199,3 billion, according to a recent report from In-Stat. This downturn comes on the heels of 2004 annual revenue growth of 27,0%, and annual revenue of $211,4 billion, a new record.
This downturn will be far less severe, because it is taking place within a relatively strong worldwide economy, an economy which is expected to grow by 4,3% in 2005, says In-Stat. There are risks to the economy, however, such as petroleum prices remaining high, Middle East tensions not easing, and/or interest rates rising too rapidly. These risks could result in slower economic growth and a deeper and/or longer semiconductor downturn.
In-Stat also found that new, mostly consumer-oriented products are diverse, and no single new product is expected to drive the industry to the extent that PCs and mobile phones have in the past. Also, greater diversity in markets will tend to make industry revenues more stable, it states.
www.instat.com
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