|
|
| Gartner Dataquest Says 2002 will Mark the Start of a Semiconductor Industry Recovery |
| Upcoming Semiconductor Conference Examines How Vendors Can Compete in this Volatile Industry |
|
SAN JOSE, Calif., October 31, 2001 - In what was already considered a difficult year in the semiconductor industry, the events of September 11 have added an additional strain on the industry, as worldwide semiconductor revenue is projected to reach $147 billion in 2001, a 35 percent decrease from 2000, according to the latest forecast by Dataquest Inc., a unit of Gartner, Inc. (NYSE: IT and ITB).
"The events of September 11 compound already weak demand as consumers and businesses reevaluate electronic equipment spending," said Richard Gordon, principal analyst for Gartner Dataquest's worldwide semiconductor group. "Continued deterioration in device average selling prices in the third quarter of 2001 means that even a significant improvement in demand in the fourth quarter, resulting in pricing stabilization, will not be enough to prevent the industry's revenue from declining 35 percent this year." Gartner Dataquest analysts point out that although this downturn may be the worst in the history of the semiconductor industry, a recovery is inevitable given the cyclical nature of investment in semiconductor capital equipment, and assuming that electronic equipment production has returned to more normal levels by 2003. While 2002 is projected to be a recovery year, worldwide semiconductor revenue growth will be just 3 percent, with revenue forecast to be $152 billion. By 2003, Gartner Dataquest expects the semiconductor industry to be in the midst of a full-blown growth cycle, with an annual growth rate of approximately 30 percent. "The slowdown in capital expenditure in 2001 will likely spill over into 2002, resulting in supply-side tightness in 2003, when a stronger demand side is expected to have returned to the market," Gordon said. "Improvements in the macroeconomic environment will likely fuel a PC replacement cycle and a recovery in the wired communications sector. In addition, the rollout of 2.5 generation and 3G cellular will be well under way in the 2003 time frame, boosting demand for silicon-rich handsets." During these difficult economic times, Gartner Dataquest analysts said it's important that vendors don't cut back too much as they try to monitor expenses. "Despite incurring losses in 2001, semiconductor vendors must, wherever possible, maintain capital and research and development spending levels to ensure competitiveness, and ultimately survival, as market conditions improve," Gordon said. As the semiconductor industry braces for a turnaround, Gartner Dataquest analysts will discuss the strategies needed to compete in the market during Gartner Dataquest's Semiconductors 2001 conference, November 8-9 at The Westin St. Francis in San Francisco. The conference has session tracks devoted to various semiconductor sectors such as: communications, data processing, design and intellectual property, emerging technologies and applications, emerging regions, and semiconductor manufacturing. Additional information about this conference is available on Gartner's Web site at http://www3.gartner.com/2_events/conferences_briefings/conferences/scon5.jsp or by calling 203-316-6574. Gartner Dataquest analysts have examined how the hardware systems and semiconductor industries will perform after the events of September 11 in the Gartner Research Spotlight "Post-11-September Attack: Hardware and Systems and Semiconductor Forecast." This Spotlight provides the outlook for the various technologies. This Spotlight is available in Gartner's Hardware and Software Focus Area, which can be found at www.gartner.com/1_researchanalysis/focus/hwmkt_fa.html. This research is produced by Gartner Dataquest's Semiconductors Worldwide group. This research group combines memory, microcomponents, logic, ASIC, analog, discrete device, RF and optical segments into a complete industry picture. Products, suppliers, startups, technologies, regional consumption, applications and emerging technologies are all covered in this broad program. To subscribe to one of Gartner Dataquest's IT services programs, please call 408-468-8000. Reports can be purchased on the Internet at www.gartner.com. Gartner Dataquest is the recognized leader in providing the high-technology and financial communities with market intelligence for the semiconductor, computer systems and peripherals, communications, document management, software, and services sectors of the global information technology industry. Gartner, Inc. is a research and advisory firm that helps more than 11,000 clients understand technology and drive business growth. Gartner's divisions consist of Gartner Research, Gartner Consulting, Gartner Measurement and Gartner Events. Founded in 1979, Gartner, Inc. is headquartered in Stamford, Connecticut, and consists of 4,300 associates, including 1,200 research analysts and consultants in more than 90 locations worldwide. The company achieved fiscal 2001 revenue of $952 million. For more information, visit www.gartner.com. |
|
Contact: Tom McCall 408-468-8312 tom.mccall@gartner.com |
