Semi sales up 10% to $263B in 2006
By Colleen Taylor, Contributing Editor -- EDN, April 5, 2007
The semiconductor industry as a whole turned in a strong performance in 2006, according to final results from market research firm Gartner Inc., with worldwide semiconductor revenue totaling $262.7 billion in 2006, a 10.2 percent increase over 2005 revenue of $238.3 billion.
"Diverging trends in key markets contributed to a moderate overall growth," John Barber, research director at Gartner, said in a statement. "Slowing growth rates in traditional markets such as PC processors were offset by strong gains in DRAM and wireless communications."
Chip making giant Intel Corp. once again stayed on top in 2006, coming in at the top ranking in Gartner's report.
However, the chipmaker had what Gartner said was a "challenging" year; the Santa Clara, Calif.-based company experienced a worldwide revenue decline of 12 percent. Until Q4, Gartner said, Intel lost share with its CPUs in the server and consumer segments to rival chipmaker Advanced Micro Devices Inc. (AMD). AMD, for its part, executed with impressive gains in market share during the year. Revenues were eroded for both companies by an across-the-board price war which Gartner said impacted Intel the most.
In 2006, AMD acquired ATI; all of ATI's revenue is reflected within AMD in Gartner's rankings, contributing to a major jump in market revenue for AMD in 2006. When comparing AMD and ATI combined results for 2005 against 2006, semiconductor revenues grew by just under 30 percent, the firm said.
However, Gartner said, late 2006 marked a turnaround for Intel, with the release of its Core 2 Duo and Xeon 5100 and, later, its quad core processor families. Gartner analysts expect Intel to re-capture losses in market share in 2007 with their new product offerings.
Samsung Electronics, the number two vendor based on 2006 worldwide semiconductor revenue, was led by increased sales in DRAM, NOR Flash, PSRAM and CMOS image sensors. Offsetting this strength, NAND flash revenue, which contributed to 2005's revenue growth, declined for Samsung as its market share fell below 50 percent in 2006.
Texas Instruments maintained its third place ranking and was supported by strong growth in both its analog and DSP products lines in 2006, while Hynix dropped to ninth place, from seventh in 2005, even though it and Infineon Technologies experienced the strongest growth rates among the top 10 vendors for worldwide semiconductor revenue, Gartner said.
