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European semiconductor distribution market picks up

The European semiconductor industry had a strong final quarter of 2016, according to the distribution association DMASS. According to the organisation, the quarter ended with €1.79billion in sales, 5.8% higher than in Q4 2015. The full year ended with sales of €7.4bn, which represents an increase of 3.8% over 2015.

Georg Steinberger, chairman of DMASS, said: “80% of the growth seems organic; an encouraging sign for 2017, as we are looking at strong bookings. What is still of concern is the fact that the overall semiconductor market does not really grow and that the pressure on the distribution channel remains unprecedented. Higher growth has definitely been prevented by price and margin pressure.”

The growth drivers are said to be predominantly countries in Eastern Europe, Israel, Russia and Turkey, while Germany, the UK and France grew slightly below average. Germany grew by 3.1%, Italy shrunk by 1.7%, the UK and Ireland grew by 4.3% and France by 4%. The Nordic countries shrunk by 14.6%, while at the same time Eastern Europe grew by 16.7%.

MOS micro, programmable logic and other digital logic led the way, with double-digit increases of revenue. Other double-digit growth areas included fibre-optics, DRAM and NAND flash. The biggest product group in distribution – analogue products – only grew by 3%.

“It is quite apparent that some areas of strong growth in the recent path, which seem to have lost steam – like power, low end MCUs and analogue – are linked tightly to the German market,” Steinberger concluded. “It remains to be seen if that is a trend or just an occurrence that will disappear in 2017.”

Peggy Lee

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