January chip sales fell 15% year-on-year, says analyst

LONDON – A number of factors are likely to have contributed to soft January chip sales according to Bruce Diesen, an analyst at Carnegie Group (Oslo, Norway).

The net effect would have been that January's actual global chip sales were 15 percent below what they were in January 2011. However, as one of the influences is the movement of the Chinese New Year from February in 2011 to January 2012 there is hope of a better-than-usual February to follow.

However, other factors remain problematic. These factors include: PC weakness and higher costs due to the continued aftermath of flooding in Thailand and observed weakness in the mobile phone handset and automotive business sectors.

The three-month average of global chip sales for January, as reported by the World Semiconductor Trade Statistics (WSTS) organization, is likely to be $22.7 billion, according to Diesen's data models. This would compare with a three-month average of $23.83 billion reported by WSTS for December 2011. Actual sales in January are set to be between 15 and 16 percent below where they were in January 2011, Diesen said.

"Although several chip makers indicated the inventory correction in Q4 has ended, our early indicator indicates that it continued into Q1," Diesen said.

Diesen said that both South Korea's broader technology exports and Japan's chip exports were down sharply in January. Korean handset exports were down 39 percent year-on-year partly due to the holiday shift from February in 2011 to January in 2012.

Diesen's forecast for growth in the semiconductor market in U.S. dollar terms in 2012 is a 2 percent increase.


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