Semiconductor revenue is set to recover

SEMICONDUCTOR SALES have taken a pounding in the last two years with revenue falling by just over 10 per cent last year compared to 2008, according to analyst outfit Gartner.

However, if the the company's predictions in its 'Market Share: Total Semiconductors, Worldwide, 2009' report are correct, revenues are set to start looking a lot better over the course of 2010.

According to one of Gartner's principal research analysts, Peter Middleton, revenues tanked massively in the final quarter of 2008 and the first quarter of 2009, but things have been picking up over the rest of the course of last year, albeit not enough to return to growth.

Unsurprisingly, Intel maintained top spot of the semiconductor league table, as it has done for the last 18 years, holding 14.6 per cent of the market share, nearly double that of its closest rival Samsung which holds 7.7 per cent. Although Chipzilla grew its market share by one per cent, its semiconductor revenues still dropped by 4.5 per cent in 2009, equating to about $1.6 billion, while Samsung was one of only two chip firms to see revenue growth between 2008 and 2009, by 1.7 per cent, thanks mainly to its DRAM and NAND flash lines.

The only other semiconductor firm to increase revenues was Hynix, which managed a 0.4 per cent boost in revenue taking it from ninth place to seventh in the market share table. Meawhile AMD managed to climb into the top 10, going from eleventh place in 2008 to ninth in 2009, with revenues dropping by only 2.7 per cent across the two years, effectively improving its standing by not doing as badly as others.

According to the report it would seem that it was a bit of luck-of-the-draw, with demand for memory and wireless chips on the up, but other segments of the industry not faring as well, hence those companies not playing in these markets were hit harder than those who do.

Although it's not all champagne and roses yet, with companies now starting to look at IT hardware refresh projects that were put off during the height of the financial crisis, chip makers are starting to see demand rise once again, setting the scene for an increasingly prosperous 2010 and beyond. µ