SIA Sees 9.1% Market Growth in 1999, 42% by 2001

-- Semiconductor International, 1/1/1999

At its semiannual economic forecast, the Semiconductor Industry Association (SIA, San Jose, Calif.) indicated it expects the worldwide semiconductor market to rebound with 9.1% overall growth with over $133.4 billion in sales next year, led by a surge in memory chips, microprocessors and DSPs. This is predicted to increase an additional 15.2% in 2000 and 18.2% in 2001.

Steve Appleton, chairman and CEO of Micron Technology (Boise, Idaho), formally presented the forecast at the SIA awards dinner. 'This (1998) has been a tough year,' he conceded. 'We experienced a negative 10.9% growth rate.' Appleton pointed out that although the market places the semiconductor industry at the $122 billion mark this year, it should reach $182 billion by 2001. 'That's a growth rate of 42% in the next three years,' he said.

SIA expects a bouncing chip market in 1999 that will overcome 1998's downtrends such as oversupply and the Asian flu. The forecast predicts the memory market will bottom out at $21.8 billion, with 18.1% growth to $25.8 billion, 23% in 2000 and 28% in 2001 with total sales exceeding $40 billion. DRAM sales are expected to grow 25% during 1999 to $16 billion, approaching $28 billion in 2001. Overall microprocessor sales should approach $35 billion in 2001, while DSPs should surpass $6.8 billion.

The computer and communications markets, which account for 64% of end-use products for semiconductors, are expected to increase over the next five years to the point at which they will consume over 70% of semiconductor production.