Chip market off to slow start in 2016

March 04, 2016 // By Peter Clarke
Market down
Weakness in the Americas market has set the global chip market off to slow start in 2016.

The three-month average for the global market for semiconductors fell in January 2016 on both a sequential and a year-on-year basis. The sequential fall of 2.7 percent to $26.88 billion is in-line with seasonal variation but the year-on-year fall was of 5.8 percent.

Both metrics were affected by sluggishness in the Americas region with avergad sales decreasing 16.9 percent year-on-year. Other geographic markets also dropped, but by less while China was the only market to show growth, just as it did through the winter months (see China is chip market's only growth region ).

Sales also decreased across most major semiconductor product categories, with the notable exception of microprocessors, which increased year-to-year by 2.1 percent. All monthly sales numbers are compiled by the World Semiconductor Trade Statistics (WSTS) organization and represent a three-month moving average. 

Three-month average of sales for January 2016 and December 2015. Source: SIA/WSTS.

"Global semiconductor sales decreased in January across most regional markets and product categories, largely due to softening demand and lingering macroeconomic headwinds," said John Neuffer, CEO of the Semiconductor Industry Association, in a statement.

In January European three-month averaged chip sales were $2.721 billion, down by 1.7 percent compared to December 2015. Nevertheless, in Europe, demand remained strong for several key product categories, according to the European Semiconductor Industry Association.

Discretes ̧ optoelectronics, sensing and emitting chips, analog devices, logic ICs and ASICs all showed growth compared to December, ESIA said in a statement. Euro-dollar exchange rates did not affect the European sales picture as much as in previous months. Measured in euros sales were €2.512 billion in January 2016, down 0.6 percent versus the previous month and an increase of 4.0 percent versus the same month a year ago.

Monthly data is given by the SIA and ESIA as a three-month average, although the WSTS organization tracks actual monthly data. The SIA and other regional semiconductor industry bodies opt to use averaged data