Semiconductor Sales Still Down In 2015

Sales of semiconductors have remained sluggish during 2015 and look set to drop still further in 2016, according to new research from Gartner.

Last quarter, 2.5 percent growth was expected for 2015, but this has been revised down to a one percent drop in the market. 2016 remains predicted to see a 3.3 percent drop.

“We are continuing to see weakness in end-user electronics demand in response to an uncertain economic environment, which is putting a dampener on 2015 spending,” said Takashi Ogawa, research vice president at Gartner. “Next year we are anticipating DRAM manufacturers to respond to oversupply with dramatic reductions in their investment plans.”

The drop likely comes off the back of weak PC sales too, with Gartner last week revealing that, despite the release of Windows 10, sales of devices slumped 7.7 percent in the third quarter.

The future looks brighter, though, and figures for 2017, 2018 and 2019 show significant growth with the losses of 2015 more than recovered as soon as 2017.

A number of key companies, including Intel, have cut spending in the past quarter against a backdrop of slow demand for electronics. This has led in some cases to semiconductor plants significantly shrinking production to avoid a surplus of obsolete chips in the fast evolving industry.

“In the DRAM market, weak end-market conditions combined with new foundries coming on line at Samsung and SK Hynix have created a weaker market than anticipated in our last forecast,” said Ogawa.

“As a result, we anticipate that DRAM manufacturers will move more quickly from investing in new capacity to a maintenance and upgrade existing capacity mode of operation.”

Meanwhile, NAND memory has actually moved to a small predicted growth of 0.1 percent against a 19.4 percent drop predicted last quarter. The rise of NAND thanks to alliances such as the one between SanDisk and HP has led Gartner to predict a 10 percent shift from DRAM to NAND in the next six months or so, while DRAM manufacturers will begin to slow investments around this time next year.

The news comes after reports that SanDisk is looking to consolidate its business by putting itself up for sale to another market player. WD and Micron are said to be likely buyers.

Source-http://www.thegurureview.net/computing-category/semiconductor-sales-still-down-in-2015.html