Technology market intelligence specialists iSuppli hasadjusted its forecast for 2008 worldwide semiconductor growth downward from 4%to 3.5%, but is warning that the chip market could be in for a rough time ifeconomic conditions continue to worsen.
Total global sales are expected to hit $280.1bn in 2008,however according to iSuppli signs began to emerge last month that thesemiconductor market was starting to feel the crunch.
Senior vice president of market intelligence at iSuppli,Dale Ford, claimed that there were several factors at play in the market.
Ford said: “The first level is demand for electronicequipment from Wall Street, which is expected to drop and thus decrease demand.The second, much more significant factor, is the impact on corporations ingeneral.
“With companies unable to get credit, the crisis couldspread to the wider economy, impacting demand for electronic equipment andsemiconductors. The final level and most significant area of impact, is thebroader effect on consumer confidence and spending,” he continued.
Of particular concern to analysts of late has been thedownturn in sales of memory, specifically DRAM, where iSuppli has cut itsforecast revenues by over 5%.
This backs up last month’s alert from Toshiba, which claimedsignificant price erosion on memory was beginning to hurt its sales figures.
ISuppli’s market update comes just days after AMD split offits chip-building activities into a new unit called The Foundry Company, afterreceiving a multi-billion dollar injection from the UAE.