Semiconductor Chip Sales Grow by 5.9% to $22.6 Billion in September

For the second consecutive month, worldwide sales of semiconductors rose sharply in September, the Semiconductor Industry Association (SIA) reported. Global microchip sales in September were $22.6 billion, an increase of 5.9 percent from September 2006 when sales were $21.3 billion. Sales were up 5.0 percent from August 2007 when sales were $21.5 billion. Third-quarter sales of $67.8 billion increased 5.9 percent from the like period of 2006 when sales were $64.0 billion. Third-quarter sales were 13.2 percent higher than the second quarter of 2007 when sales were $59.9 billion. For the first nine months of 2007 sales were $188.8 billion, 3.5 percent ahead of the $182.5 billion for the first nine months of 2006.

“The increase in worldwide sales of 13.2 percent from the prior quarter reflects historic patterns as the holiday season build began,” said SIA President George Scalise. “Demand from the consumer products sector was very robust as sales of semiconductors for traditional consumer applications rose by 35 percent quarter-to-quarter. The two largest demand drivers for semiconductors – PCs and cell phones – continued to show healthy growth. According to the Gartner Group, worldwide unit sales of PCs increased by 14.4 percent over the immediate-prior quarter. Gartner currently expects that PC sales will increase by 13 percent year-on-year. Microprocessor revenues increased by 18.7 percent compared to the prior quarter.

Worldwide sales of semiconductors - September 2007The quarterly reports from the four largest cell phone vendors indicate that unit sales in the third quarter grew by approximately 11 percent from the prior quarter. “Strong sales of cell phones and personal electronics products were a major contributor to sharp increases in revenue for NAND flash,” said Scalise. “Sales of NAND flash were up by 46.2 percent from the prior quarter and by 58.5 percent in September 2007 compared to September 2006. ASPs for NAND flash increased by nearly 32 percent from the second quarter.”

“Worldwide sales of semiconductors for the first nine months of 2007 are running slightly ahead of the SIA June forecast. At this point, concern over rising energy costs has not been an issue. This will bear watching, however, as we move into the retail selling season,” Scalise concluded.

About the SIA Global Sales Report
The SIA Global Sales Report (GSR) is a three-month moving average of sales activity. The GSR is tabulated by the World Semiconductor Trade Statistics (WSTS) organization, which represents approximately 66 companies. The moving average is a mathematical smoothing technique that mitigates variations due to companies’ financial calendars.

September 2007 (Billions)

Month-to-Month Sales

Market Last Month Current Month % Change
Americas 3.58 3.81 6.2%
Europe 3.38 3.53 4.6%
Japan 4.10 4.26 3.8%
Asia Pacific 10.47 11.01 5.2%
Total 21.53 22.60 5.0%

Year-to-Year Sales

Market Last Month Current Month % Change
Americas 3.89 3.81 -2.2%
Europe 3.41 3.53 3.5%
Japan 4.02 4.26 5.8%
Asia Pacific 10.02 11.01 9.9%
Total 21.34 22.60 5.9%

Three-Month-Moving Average Sales

Market Apr / May / Jun Jul / Aug / Sep % Change
Americas 3.31 3.81 15.0%
Europe 3.21 3.53 10.2%
Japan 3.88 4.26 9.8%
Asia Pacific 9.57 11.01 15.0%
Total 19.97 22.60 13.2%

About the SIA
The SIA is the leading voice for the semiconductor industry and has represented U.S. semiconductor companies since 1977. Collectively, the chip industry employs a domestic workforce of 232,000 people.