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Semi sales set to surpass $400bn in 2018

In 2002, seemingly back in the mists of time, a semiconductor industry executive noted: “It is now clear that we are going through the worst semiconductor industry recession ever. Yet, we are told, the industry is bound to resume its growth curve as it did many times in the past. I am afraid it might not.”
Guess what? It did.

If you plot semiconductor sales against time, it’s relatively easy to draw a straight line through the data points; with the gradient of that line showing annual sales growth of 15%. Sales for 2017 are expected to be $380billion – maybe more – and industry watchers are predicting the $400billion mark will be passed in 2018. If – when – that happens, the market will be four times the size it was in 1994.

But that ‘straight line’ lies over a white knuckle roller coaster ride of ‘boom and bust’, with capacity outstripping demand for a while, after which demand outstrips capacity.

The current boom – semiconductor sales in 2017 are expected to be 17% higher than in 2016 – is being ascribed to rising memory prices because demand is outstripping supply.

'Twas ever thus.

Graham Pitcher

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