Data from DMASS has shown European semiconductor distribution sales fell 8.9% to €2.11 billion in Q3 2019. The situation is uneven at country and regional level. Germany, France and Italy experienced a double-digit decline – falling 12.9% to €618 million, 13.1% to €168 million, and 15% to €132 million, respectively.
In contrast, UK sales grew 1.6% to €159 million and Eastern Europe grew by 0.5% to €380 million. The Nordic countries (including the Baltic states) experienced a decline, but this was much less pronounced than elsewhere – falling by 3.7% to €183 million.
Georg Steinberger, chairman of DMASS, commented, “A slowdown in customer bookings throughout the year now materialised in a not surprising revenue decline. It is a mix of factors that is driving the slowdown – external and internal – and most of them will accompany us for a while. There is more caution and scepticism in the market than necessary, as we think that the opportunities for technology are still great. We expect the market to return during 2020.”
He added, “No big change to previous quarters. Countries with a huge share of contract manufacturing continue to grow or at least maintain their momentum, while OEM-driven markets experience a bigger slowdown or lose more business specifically to Eastern Europe, which has a strong contract manufacturing base. The most surprising aspect of this quarter is the resilience of the UK against the current Brexit frenzy.”
DMASS has said the decline broadly spans all technologies and products. Yet Discretes, Standard Logic and MOS Micro declined by double digits, whereas, Power, Opto, Memories and Other Logic held up, with a minus between 0.6% and 7.5%.
Analog products shrank by 8.65% to €618 million, MOS Micro went down by 11.7% to €413 million, Power Discretes declined 2.6% to €241 million, Opto products by 7.5% to €194 million and Memories by 6.9% to €195 million. Other Logic declined by 0.6% to €123 million.
Georg Steinberger explained, “The quarterly view does not really allow much insight as the situation is different in almost every country. Over the first 9 months however, we see that some areas are over-proportionally weak – like Discretes, Opto, MOS Micro, Standard Logic and Programmable Logic, while Analog, Memory and Power hold up nicely. What is hard to estimate is the impact of suppliers taking business from distribution direct. We know that areas like Analog, Programmable Logic or MOS Micro are affected by it and will be more so in the future.”