The Semiconductor Industry Association [SIA] reported worldwide chip sales rose 2.4% y/y to $20.3 billion in May (+1.2% sequentially). "Sales of microprocessors and NAND flash memory saw the largest sales increases, indicating continued strength in end markets for personal computers and cell phones," said President George Scalise. However, according to Semiconductor Fabtech, the 1.2% sequential rise was 'anemic' considering April is typically the worst month of the year for semiconductor sales. "The low growth level coming off April's figures reflects the continued over-capacity in memory markets leading to below-cost ASPs and continued pricing competition in the microprocessor market rather than a lack of real end-demand," said Fabtech. On a more positive note, SIA reported unit sales of digital signal processors [DSPs] increased more than 5% sequentially, "indicating that cell phone inventory issues have been resolved." Year-to-date through May, total sales of semiconductors have increased 3.1% despite "severe price pressures" on DRAM and NAND flash chips.
Sources: SIA press release, Semiconductor Fabtech, Wall Street Journal
Commentary: iPhone: A Look Inside • Four Reasons Why Lehman Is Bullish On The PC Processor Sector • Semi Equipment Order Downturn Unlikely To Be Just One Month
Stocks/ETFs to watch: Advanced Micro Devices (AMD), Analog Devices (ADI), Infineon (IFX), Intel (INTC), Macronix Int'l (MXIC), Micron (MU), NVIDIA (NVDA), Qimonda (QI), SanDisk (SNDK), STMicroelectronics (STM), Texas Instruments (TXN). ETFs: iShares Goldman Sachs Semiconductor (IGW), Semiconductor HOLDRs (SMH), SPDR Semiconductor (XSD)
Related: SIA May '07 sales data table and chart [pdf]
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