First Quarter of 2007 Semiconductor Forecast Update
28 February 2007
The semiconductor market is poised to record another year of modest growth. In the short term, although inventory levels are improving, the outlook for growth in end-market semiconductor demand is weakening, especially in the key PC and cellular phone markets. Semiconductor supply-side market conditions remain controlled, with vendors lacking the business confidence to invest aggressively, confirmed by the slowdown in capital spending expected in 2007. The exception is in the commodity memory space, where volatility remains a feature of the dynamic random-access memory (DRAM) and NAND flash memory markets. The midterm forecast is for continued steady annual revenue growth with a cyclical market peak, albeit mild, expected in 2008. A cyclical market downturn is forecast for 2009, with a subsequent recovery in 2010 and 2011; the long-term industry growth rate is expected to remain in the single-digit range.
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Topics Discussed Gartner analysts discussed with participants the following topics:
What are the short-term and long-term outlooks for semiconductor device and application market growth?
What are the latest developments in the commodity memory market, and how is the outlook for DRAM and NAND flash memory affected?
How is the market for digital cellular handsets evolving, and what are the implications for semiconductor market growth?
What are the latest trends in inventory levels, capacity utilization rates and capital spending, and how will they affect the supply side of the semiconductor market?
