IDC’s Worldwide Semiconductor Market Forecaster Reveals Its First Results, Including Top 10 Vendor Rankings
FRAMINGHAM, MA – AUGUST 22, 2007 – IDC's new Worldwide Semiconductor Market Forecaster predicts that the 2007 revenue slowdown in the worldwide semiconductor market will make way to a healthier year in 2008. The worldwide semiconductor market will grow at a conservative rate of 4.8% in 2007, compared to 8.8% in 2006. IDC expects growth to resume at 8.1% in 2008 based on the current outlook. An even healthier outcome could be realized, should capacity expansion be more tempered in 2008 and growth in demand remain strong. Elsewhere, market trends point to ongoing mergers and acquisitions that will reshape the competitive landscape and bring traditional suppliers back to the forefront.
"The semiconductor market oversupply in 1H07 has tempered the revenue forecast of major suppliers and will put pressure on margins for the remainder of the year," said Gopal Chauhan, program manager, Worldwide Semiconductor Market Forecaster at IDC. "While broad base inventory correction for suppliers has bottomed out, pricing pressure will continue due to competition and volume growth coming from emerging regions which drive lower priced SKUs."
Outlook for 2007
* Demand for semiconductors is centered on the big three segments: PC and mobile phone unit volume is steady, led by emerging regions and low-end products. Consumer demand is lackluster, but excess inventory has subsided and IDC expects the design momentum to lead to healthy volume growth during the holiday season.
* DRAM and NAND are experiencing much lower revenue outlook this year following the severe price correction in the first half of 2007.
* Microprocessor market remains flat this year.
Long Term Trends
* Emerging regions will boost semiconductor volume growth.
* Multimedia-rich mobile phones continue to drive semiconductor content and demand for processing, memory consumption, and power management.
* Personal computing further migrates toward mobility and low-priced form factors.
* Video processing proliferates across multiple consumer electronic segments, resulting in strong growth for semiconductor suppliers.
* Semiconductor connectivity technologies drive new usage models across device segments.
* Growth in personal content implies increasing need for storage, including NAND.
Top 10 Vendors Ranking
In 2006, the top 10 semiconductor vendors accounted for 48% of the worldwide market revenue. Intel, Samsung and Texas Instruments (TI) held on to the number 1, 2 and 3 positions respectively, with TI showing the highest growth percentage in revenue among the top three leaders. With the exception of Intel, Renesas, and NXP, all other vendors in IDC's 2006 top 10 ranking showed positive growth. Hynix grew at an amazing rate of 43% over the same period thanks to the company's growing position in DRAM and NAND.
Worldwide Semiconductor Revenue for Top 10 Companies (Millions
2005 Rank 2006 Rank Company Name 2006 Revenue 2005 Revenue Percentage Change Market Share Cumulative Percentage
1 1 Intel 31,576 33,340 -5.3% 12.7% 12.7%
2 2 Samsung Electronics 19,605 18,504 6.0% 7.9% 20.7%
3 3 Texas Instruments 13,100 11,300 15.9% 5.3% 25.9%
4 4 STMicro electronics 9,854 8,807 11.9% 4.0% 29.9%
5 5 Toshiba 9,262 8,972 3.2% 3.7% 33.7%
6 6 Renesas Technology 7,913 8,195 -3.4% 3.2% 36.9%
9 7 Hynix 7,866 5,516 42.6% 3.2% 40.0%
10 8 Advanced Micro Devices 7,586 3,952 92.0% 3.1% 43.1%
8 9 Freescale Semiconductor 6,049 5,595 8.1% 2.4% 45.5%
7 10 NXP 5,874 5,959 -1.4% 2.4% 47.9%
Other Companies 129,072 117,535 9.8% 52.1% 100.0%
Total: 247,757 227,675 8.8% 100.0%
Source: IDC Worldwide Semiconductor Market Forecaster, August 16, 2007
IDC's Worldwide Semiconductor Market Forecaster gathers revenue data from the top 40 semiconductor companies for 2004–2007 and provides market forecasts for 2008–2012. This database also includes revenue for 30 semiconductor devices and four geographic regions.
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