November Chip Sales Strong; '07 Seen Stronger Than '06

 |  Includes: SMH, SOXX, XSD
by: SA Editors

The Semiconductor Industry Association reports November chip sales rose 11.3% y-o-y to $22.7b (+3.1% m-o-m), for a fifth consecutive monthly record. Year-to-date (Nov.) sales are up 9.4% to $225.1b. SIA President George Scalise comments, "Despite some signs of slower economic growth in the fourth quarter, consumer purchases of electronic products remained strong and again drove semiconductor sales to record levels." Semi-Holders-SMH-1yr-chart-12-29-06 The SIA cites data from the Consumer Electronics Association, which lists digital cameras leading ytd-Nov. sales, up 40%, followed by DSPs +12.3%, DRAMs +6.8%, NAND +6.3% and microprocessors +4.3%. Scalise says ytd sales are in-line and he sees even higher growth in '07 at 10%. Red Herring reports the sales data is positive ahead of CES and Macworld next week. It points out semi growth was strongest in Asia and slowest in Europe -- and notes portable digital music players total 20% of chip consumption.

• Sources: SIA press release, Red Herring
• Related commentary: Semiconductor Industry No Longer Concerned With Inventory Glut, Post-Vista Memory Glut: Stay Away from Chip Stocks, Don't Hold Your Breath Waiting for Semi Equipment Orders to Resume, Major Media Coverage is Sign Chipmaker Fundamentals May Be Bottoming Out
• Potentially impacted stocks and ETFs: Advanced Micro Devices (NYSE:AMD), Analog Devices (NYSE:ADI), Infineon (IFX), Intel (NASDAQ:INTC), Macronix Int'l (MXIC), Micron (NASDAQ:MU), NVIDIA (NASDAQ:NVDA), Qimonda (QI), SanDisk (SNDK), STMicroelecronics (NYSE:STM), Texas Instruments (NYSE:TXN). ETFs: iShares Goldman Sachs Semiconductor (IGW), Semiconductor HOLDRs (NYSEARCA:SMH), SPDR Semiconductor (NYSEARCA:XSD)

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