Computer circuit forecast rebounds

Gartner Inc. located in Stamford, has raised its worldwide integrated circuit forecast from 3.4 percent to 4.6 percent for 2008.

According to Gartner, the integrated circuit industry is now projected to hit $287 billion in 2008, up from $274 billion in 2007.

“Global sales for semiconductors were seasonally normal in the first quarter, thanks to a strong personal computer and cell phone market,” said Richard Gordon, analyst at Gartner.

According to Gordon, the firm raised the integrated circuit forecast because of the stable market and despite current economic climate and concerns.

In December, Gartner said the overall integrated circuit market would grow by 6.2 percent in 2008 over 2007. Then in March, the firm said the semiconductor market would grow only 3.4 percent in 2008.

Last week, the World Semiconductor Trade Statistics Group reported the global semiconductor market is expected to grow by 4.7 percent to $267.7 billion in 2008.

In 2007, the integrated circuits market grew 3.2 percent.

The current projections have been reduced by 4.4 percentage points compared with the forecast that World Semiconductor Trade Statistics Group issued in November of last year.

According to the statistics, there are still mixed signals in integrated circuits and related end-user markets, such as PCs and storage.

“Consumer notebook PC demand is tracking in line with historical trends,” said Tayyib Shah semiconductor analyst for Longbow Research. “Notebook vendors with greater exposure to the consumer segment are maintaining their earlier expectations of a 10 percent-plus quarter-over-quarter increase in shipments in the second quarter of 2008.”

According to Shah, Longbow”™s checks indicate weakness in U.S. corporate notebook demand with major original equipment manufacturers including Dell and Acer showing some weakness in their orders.

“This is in line with our survey work into the enterprise storage market, which is also showing signs of weak IT spending,” said Shah.