Analyst sees upside in 2H11 chip market
The reduction is due to the weakness of the semiconductor market in 2Q11, which has knocked what was set to be an average year of course, Jewell said. However, whereas many analysts are attributing the 2Q decline to general economic malaise and fear of a double dip recession in the western hemisphere, Jewell sees the weak Q2 as being due to the March earthquake and tsunami in Japan which damaged much of the semiconductor supply chain.
Jewell observed on his website: "the news is not all bad," before going on to point out that while consumers may be hurting and cutting back in some areas, consumer and business spending on electronics is still relatively strong. U.S. consumer spending on recreational goods and vehicles, which is 75 percent electronics-based, grew 15.3 percent in 1Q11 and 9.3 percent in 2Q11, Jewell observed. U.S. business investment in equipment and software grew 8.7 percent in Q1 and 7.9 percent in Q2, he said.
The Q2 problem for the chip industry was clearly mainly a Japanese problem. The Japan Q2 market was down 8.1 percent from 1Q11 and while the rest of the world suffered it only showed a sequential decline of 0.9 percent.
Taking heart from the forward-looking statements of a number of publicly-owned chip companies Jewell said that Renesas expects 3Q11 yen-denominated chip sales to bounce back 23 percent and Intel, AMD and Qualcomm all expect healthy 3Q11 growth with midpoints of their guidance ranging from 7 to 11 percent, which is a typical seasonal sales pattern. Texas Instruments and STMicroelectronics remain more bearish as they say they expect a slight decline to moderate growth in Q3, said Jewell.
"The semiconductor industry should continue to grow at a moderate rate for the remainder of 2011 and in 2012. Despite concerns about the overall economies in the U.S. and Europe, major drivers of the semiconductor market remain fairly healthy," Jewell concluded.
Semiconductor Intelligence is keeping its 2012 forecast for global chip market growth at 10 percent.