MAY 20--Following a strong first quarter in 2003 bolstered by better-than-expected semiconductor sales in March, the worldwide semiconductor market is forecast to grow 8.3% in 2003, with revenues totaling $168 billion, up from $152 billion in 2002, according to Gartner Inc. (Stamford, CT;www.gartner.com). "With quarterly sequential growth at about negative 3.5% in the first quarter of 2003, but likely to turn mildly positive in the second quarter, it appears that the industry is capable of growing in the high single digits this year," says Richard Gordon, research vice president for Gartner's semiconductor research group. "However, even though some of the geopolitical uncertainty that has been dogging the global macroeconomic environment receded with the end of the war in Iraq, and with the severe acute respiratory syndrome (SARS) outbreak seemingly more under control, indications about the level of demand for semiconductors in the second half of 2003 remain stubbornly elusive."
Gartner analysts said that businesses are not yet feeling confident enough to make the decision to invest, putting a cautious outlook on the onset of the long-awaited corporate PC replacement cycle.
Digital cellular handsets, flat-panel displays, and digital video consumer products are expected to have strong growth in 2003. The cellular phone handset application continues to prop up the semiconductor industry, driving above-average device market growth for memories, digital signal processor-based ICs, and CMOS image sensors. Strong growth is also expected in the LCD driver market and in application-specific devices for consumer electronics.
Additional information is available in the Gartner Dataquest report2Q03 Semiconductor Forecast Update: Outlook Unchanged.