Asia-based semi vendors repel 2009 downturn
While the rest of the global semiconductor industry suffered a sharp downturn in 2009, Asia-Pacific-based chipmakers actually grew, albeit modestly, by 2.3%, according to market researchers at iSuppli Corp.
By Ann Steffora Mutschler, Contributing Editor -- EDN, March 17, 2010
While the rest of the global semiconductor industry suffered a sharp downturn in 2009, Asia-Pacific-based chipmakers actually grew, albeit modestly, by 2.3%, according to market researchers at iSuppli Corp.
Combined revenue for semiconductor companies with headquarters located in the Asia-Pacific region reached $44.5 billion last year, up from $43.5 billion in 2008. Comparatively, global semiconductor revenue in 2009 fell by 11.7% to $229.9 billion, down from $260.2 billion in 2008.
“In a dismal year for the chip industry, suppliers based in Asia-Pacific managed to eke out some growth in 2009 as they focused on hot semiconductor products and capitalized on strong demand from the region,” said Dale Ford, senior VP, market intelligence services, for iSuppli, in a statement.
“These companies represented some of the leading players in hot-selling product segments in 2009, including NAND flash and Light-Emitting Diodes (LEDs). They also were able to cash in on semiconductor sales driven by China’s stimulus plan, which spurred massive consumer spending on a range of electronic products during the year,” he continued.
Semiconductor shipments to Asia-Pacific dropped by 5.3% in 2009, which was by far the best performance of any major worldwide region for the year. In comparison, Japan’s revenue fell by 20.7%, Europe-Middle East-Africa declined by 20.5% and the Americas region decreased by 10.5%.
is iSuppli’s final regional semiconductor revenue estimate for 2009.
LEDs and NAND flash memory were the only two large semiconductor product segments that escaped the downturn of 2009. Given the expanding demand from mobile products such as cell phones, the NAND Flash market grew by more than 15% in 2009, while LEDs saw a rapid rise in adoption in a wide range of applications, especially in backlighting of LCD-TVs, causing their revenue to rise by more than 5%.
In particular, this benefitted the South Korean companies that concentrate on these products including leading NAND flash suppliers Samsung Electronics Co. Ltd. and Hynix Semiconductor Inc. that were the only semiconductor suppliers among the world’s Top 10 chipmakers to achieve growth for the year. At the same time, LED maker Seoul Semiconductor Inc. saw its revenues jump by nearly 90% for the year.
Semiconductor suppliers based in South Korea collectively achieved 3.6% revenue growth in 2009, and more than three-quarters of all South Korean suppliers tracked by iSuppli posted revenue growth in 2009.
Suppliers based in Taiwan experience the same product and demand trends as well as benefits in 2009, with suppliers based here collectively expanding their revenue by 1.1% during the year. More than half of Taiwanese suppliers achieved revenue growth in 2009 with MediaTek, Nanya Technology and Macronix International leading the way for Taiwan with growth of 22.6, 21.2 and 14.4%, respectively, for the year.
is iSuppli’s final global semiconductor revenue ranking for 2009.
“While 2009 was a difficult year for the semiconductor business, it could have been much worse, based on the state of the market in the first quarter. However, on a sequential quarterly growth basis, the market finished the year on a very strong note,” Ford said.
After seeing revenue plunge by more than 18% in Q1 2009, the market recovered with strong quarterly sequential growth of more than 18% in Q2 and Q3 and more than 10% growth in Q4, iSuppli noted.
“The final three months of 2009 actually delivered the strongest fourth-quarter sequential growth the semiconductor industry has experienced in 10 years,” he observed.
Out of approximately 300 semiconductor suppliers measured by iSuppli, two-thirds suffered falling revenues in 2009 with only four of the Top 25 semiconductor suppliers able to increase their revenues in 2009. Three of the four companies that were able to grow in 2009 are memory suppliers: Samsung, Hynix and Elpida Memory. MediaTek’s dramatic growth in 2009 allowed it to jump eight places in the market rankings to No. 16—its rise fueled by the company’s major success as a supplier of semiconductors into mobile handsets and wireless connectivity products in Asia, iSuppli said.
Six other companies among the top 25 were able to perform notably better than the market in 2009.
As it continues to expand its share of the mobile handset market, Qualcomm saw its revenue decline by only 1.1%. Driven by a rebounding microprocessor market, Intel Corp. and Advanced Micro Devices Inc. (AMD) were able to limit their revenue declines to 4% and 4.6%, respectively.
The stronger memory market was behind the relatively robust performance of Micron Technology Inc. and Toshiba Corp. If Micron had not spun off its image sensor business, its revenue would have grown by more than 8% in 2009. Micron’s memory business grew by more than 13%. Finally, Broadcom’s growing revenues from wireless communications helped it limit its revenue decline to under 8%.
On a bright note, out of the 300 companies measured by iSuppli, 20% were able to grow their revenue by double-digit percentages and 12 companies were able to expand by more than 50% during the year.
In addition to MediaTek, five other companies made notable advances up the rankings of the top 25. Qualcomm and Hynix both moved up two positions, to No. 6 and No. 7, respectively. Micron moved up three places to No. 13 and Elpida Memory jumped up four places to No. 15. Freescale Semiconductor dropped four places down to No. 17 and Renesas Technology, Sony, and Panasonic Corp. all fell three places. It should be noted that when the merger of Renesas Technology and NEC Electronics is completed, the combined company would be ranked at No. 5 with combined revenues of more than $9.5 billion.
iSuppli pointed out that the hardest hit companies among the Top 25 suppliers were Sony and Freescale Semiconductor with revenue declining by more than 30% during the year. Sony suffered from its struggles in the consumer electronics market while Freescale’s revenue was hit by its exit from the mobile handset market.
Six other companies among the Top 25 saw their revenues drop by more than 20%: Renesas Technology, Infineon Technologies, NEC Electronics, Panasonic Corporation, NXP and ROHM Semiconductor. iSuppli added that it should be noted that Infineon’s revenue was impacted by its spinoff of Lantiq and that the combined revenues of Infineon and Lantiq fell by less than 17%.
