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2012 chip market forecast revised downwards

December 09, 2011 // Dylan McGrath

2012 chip market forecast revised downwards

Market research firm Gartner Inc., has reduced its forecast for the 2012 global semiconductor market, saying it now expects the market to reach $309 billion, a 2.2 percent increase from the projected total this year.

Gartner (Stamford, Connecticut) had earlier forecast that the semiconductor market would grow by 4.6 percent in 2012.

Bryan Lewis, research vice president at Gartner, said through a statement that uncertainty over spending by both consumers and enterprises in light of the European financial crisis appears set to continue, bringing significant implications for the semiconductor industry. "The near-term forecast is being shaped not only by economic forces but by an inventory correction, manufacturing oversupply and natural disasters," Lewis said.

Gartner also lowered its PC production forecast for 2012, saying it now expects PC unit growth of 5.1 percent for the year down from an earlier forecast of 10.1 percent. Gartner cited not only a weak economic backdrop, but also lingering supply chain effects from the Thai floods, for the PC production forecast cut.

Gartner did forecast that the global DRAM market will grow by 3 percent in 2012, following a projected decline of 26 percent in 2011. NAND flash is the expected to be the fastest-growing device category in 2012 with 16.6 percent growth due to strong growth in mobile consumer devices, Gartner said.

Gartner said it does expect slightly higher mobile phone production unit growth in 2012 than it did in its previous forecast. The firm now expects mobile phone production units to increase 7.5 percent in 2012, up from an earlier estimate of 7 percent.

But Gartner lowered its forecast for media tablet production, saying it now expects 107 million units to be produced next year, down from an earlier forecast of 110 million. Even the reduced forecast for media tablets calls for 63 percent production growth compared to 2010.

Lewis said Garnter's latest forecast analysis predicts that dollar growth in smartphones, media tablets and solid-state drives will in total generate 77 percent of semiconductor market growth through 2015.

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