Semico lowers 2002 chip forecast to 6%

SEPTEMBER 5--Phoenix-based market-research firm Semico Research Corp. (www.semico.com) has lowered its overall semiconductor forecast for 2002, but noted that the market will rebound and recover in 2003 and 2004.

Sep 5th, 2002

SEPTEMBER 5--Phoenix-based market-research firm Semico Research Corp. (www.semico.com) has lowered its overall semiconductor forecast for 2002, but noted that the market will rebound and recover in 2003 and 2004. Originally, in May, Semico predicted that chip sales would bounce back from the severe 2001 recession with 17% growth in 2002. In 2001, the worldwide IC market fell by a staggering 31% over 2000, according to Semico. The firm has lowered its overall forecast, saying that the worldwide semiconductor market will grow only by 6% in 2002.

Semico also projected 30% growth for the IC industry in 2003. The IC market also looks strong in 2004, but the industry is expected to enter into a downturn in 2005, said Jim Feldham, president of Semico. Feldham also put a sobering spin on the outlook, saying that worldwide semiconductor sales will not reach their peak levels of 2000 until 2004. "It won't be until 2004 before we get back to the same level as we were in 2000," he said. "Then, we're back in a downturn in 2005," he told the audience at the conference.

What will drive the market in 2003? While the PC and cellular-phone upgrade markets will propel demand, China will also remain a bright spot. "If we look into the next decade, China will become the next golden economy," Feldham added.

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