Chip market recovery on track but Europe, Japan disappoint
European and Japanese growth disappointed in the latest chip market figures, compensated for by a dramatic improvement in conditions in the Americas region.
The three-month average of global chip sales in July was US$43.22 billion, down 11.8 percent from a year before, according to figures from the Semiconductor Industry Association (SIA), which reports numbers collected by the World Semiconductor Trade Statistics organization.
This year-on-year market decline was considerably lower than the 17.3 percent decline recorded in July and in-line with the overall trend set in previous months.
The Chinese and Asia-Pacific regions were almost exactly in-line with trends and as they represent more than 50 percent of the market in aggregate kept chip growth improvement on track. It is expected that the decline will drop to a single-digit percentage in subsequent months and return to market growth before the end of 2023.
Although Europe is the only region showing growth in the chip market but its 5.9 percent growth fell back from 7.6 percent in June. This hints that global economic weakness is now blunting European chip market growth
China’s chip market weakness of -18.7 percent was much reduced from falls of 29.5 and 24.4 percent in May and June, respectively. The Asia-Pacific region excluding China and Japan was down 16.2 percent, also a smaller decline than the previous month.
Meanwhile the Americas region’s decline went from 17.9 percent in June to just 7.1 percent in July considerably outperforming expectations.
Three-month average of chip sales by geographic region for July and June 2023. Source: SIA/WSTS.
“The global semiconductor market has experienced modest but steady month-to-month growth this year, with sales increasing for the fourth consecutive month in July,” said John Neuffer, CEO of SIA, in a statement. “Global sales remain down compared to last year, but the year-to-year decrease in July was the smallest gap of the year to date, providing reason for optimism over the remainder of 2023 and beyond.”
Monthly data is given by the SIA as a three-month average although the source of the data, WSTS, tracks monthly data. The SIA and other regional semiconductor industry bodies opt to use averaged data because it evens out the actual data that typically shows troughs at the beginnings of quarters and peaks at the ends of quarters.
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