Revised forecast

The Semiconductor Industry Association (SIA) today issued a revised forecast projecting that worldwide sales of semiconductors will grow by 6% in 2005 to a record $226 billion.

The SIA November forecast had projected that 2005 sales would be essentially flat with the $213 billion sales level of 2004. The new forecast also projects a compound annual growth rate (CAGR) of 9.8% through 2008. The SIA now projects that global chip sales will reach $309 billion in 2008.

“Worldwide sales of semiconductors have been stronger than expected through the first quarter of 2005,” said SIA President George Scalise. “Higher sales have been driven by better than expected demand in a number of important end markets, including personal computers and wireless handsets. Our cautious forecast issued in November of 2004 was based on concerns that high energy prices and lingering excess inventories in a few segments of the industry would dampen sales in 2005. Those fears have not materialized, and economic growth – especially in the United States – has remained strong.”