Gartner ups 2012 chip forecast to 4% growth

March 15, 2012 // Jean-Pierre Joosting

Global semiconductor revenue is expected to increase by 4 percent to $316 billion in 2012, according to the latest forecast from market research firm Gartner Inc.

The revised forecast calls for higher annual growth than Gartner's previous forecast, issued last December. That forecast projected 2.2 percent growth for the year.

Worldwide semiconductor revenue is projected to total $316 billion in 2012, a 4 percent increase from 2011, according to Gartner, Inc. This outlook is up from Gartner's previous forecast in the fourth quarter of 2011 for 2.2 percent growth.

"The semiconductor industry is poised for a rebound starting in the second quarter of 2012," said Bryan Lewis, research vice president at Gartner, in a statement. "The inventory correction is expected to conclude this quarter, foundry utilization rates are bottoming, and the economic outlook is stabilizing."

In the memory sector, DRAM pricing is expected to improve beginning in the second quarter of 2012, Gartner said. The DRAM market will show a slight revenue increase in 2012—up about 1 percent from 2011—after declining 25 percent in 2011, Gartner said. DRAM prices declined about 50 percent in 2011, and Gartner analysts expect pricing to rebound in part due to the bankruptcy filing last month of Japan's Elpida Memory Inc.

NAND flash memory is expected to be one of the fastest-growing device types in 2012, with revenue forecast to grow 18 percent, Gartner said. Analysts attribute the NAND flash growth to a strong increase in mobile consumer devices and solid-state drives.

Media tablet unit production is forecast to increase 78 percent over 2011, and semiconductor revenue from media tablets will reach $9.5 billion in 2012, according to Garter's projections. Quad-core processors and higher-resolution displays will be mainstream for tablets in 2012, the firm predicted.

PC unit production is projected to increase 4.7 percent in 2012, with semiconductor revenue from PCs reaching $57.8 billion, according to Gartner. Mobile phone unit production is expected to grow 6.7 percent, with semiconductor revenue for mobile phones totaling $57.2 billion in 2012, Gartner said. The firm's analysts said that further innovation focused on location and context will require advances in sensing, processing, displays, connectivity and power efficiency.

"2012 should be a reasonably strong year for the semiconductor industry if the macroeconomic outlook stays in check," Lewis said. "Gartner's 2012 semiconductor forecast of 4 percent growth assumes the European debt issues stay contained, Iran/Israel tensions stay in check, and solid growth from China."

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