July 1, 2002 7:30 AM PDT

Asia helps lift May chip sales

The chip sector was a little bit merrier in May.

Worldwide semiconductor sales rose close to 3 percent to $11.4 billion for the month, thanks to stronger sales across most categories and geographies, the trade group Semiconductor Industry Association (SIA) said Monday. April chip sales totaled $11.1 billion.

The steady increase in sales indicates that the semiconductor market is mounting a recovery from last year's chip slump, according to the SIA.

"While the computation sector is down, all other sectors including wireless and consumer continue to thrive," said George Scalise, the SIA's president, in a statement. "We expect the industry to close the second quarter with growth of 4.7 percent."

Measured against last year, sales were 10.5 percent lower than the May 2001 figure of $12.7 billion. But there was an overall improvement, because of gains in areas such as flash memory and digital-signal processors, the SIA said. April sales, in contrast, were 19.4 percent below the $13.7 billion figure reported in April 2001.

Sales in the Asia-Pacific region were particularly strong in May, rising 22.4 percent, thanks to a large concentration of chip foundries. Companies such as Taiwan Semiconductor Manufacturing make processors and other chips for a wide variety of clients on a contract basis.

The SIA, in its recent midyear forecast, predicted that chip sales will grow by 3.1 percent this year. The trade group predicts a return to double-digit growth in 2003, with an increase of 23.2 percent.

That would be welcome news for chipmakers, which have suffered through one of the industry's worst slumps. Worldwide chip sales decreased 31 percent year-over-year in 2001, to $141 billion.

 

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