SIA: Semi Sales Up, Record Year on Track

Staff Reporter -- Electronic News, 8/3/2006

Worldwide semiconductor sales totaled $19.6 billion in June, a 9 percent increase over June 2005, according to a recent report by the Semiconductor Industry Association (SIA).

June's sales figures bring Q2 sales to a total of $58.9 billion, a decrease of 0.3 percent from Q1, and a 9.4 percent increase over the same period last year. These numbers bring total sales for the first half of the year to $118 billion, up 8.3 percent over the first half of 2005, the industry group reported.

"The semiconductor sales numbers reported today reflect the mixed earnings results we have seen in the industry over the past few weeks," SIA President George Scalise said in a statement. "Unit demand has remained strong this quarter, up about 5 percent across the industry. Strong competitive pressures that have reduced prices in some major product sectors are impacting revenues."

Unit sales of PCs rose approximately 10 percent in Q2 over the same period last year. Competitive pricing has affected average sales prices in this sector of the market, SIA said, as the average price of a laptop fell by more than 18 percent compared to Q2 2005.

"Communications applications grew at a very steady pace year over year -- that market represents a quarter of total demand in the industry," Scalise said.

Scalise made note of unit demand for cell phones at 235 million in the quarter just ended. According to SIA data, that number is expected to grow more than 4 percent this quarter and at least 10 percent in Q4, with total cell phone demand this year nearing the 1 billion unit mark.

"Despite the current uncertainties in the global economy, driven by geopolitical issues in the Middle East, higher gas prices at the pump and inflation fears, I remain confident that sales will reach record high levels this year as previously predicted," Scalise added.