Electronic Industry Update

Staff -- Semiconductor International, 2/1/1999

Worldwide Sales of Semiconductor Devices Historical Data: WSTS	Manufacturers' Shipments of Electronic Components Historical Data: U.S. Department of Commerce Forecast: Cahners Economics
Manufacturers' Shipments of Office & Computing Machines Historical Data: U.S. Department of Commerce Forecast: Cahners Economics	Manufacturers' Shipments of Communications Equipment Historical Data: U.S. Department of Commerce Forecast: Cahners Economics

Through October, computer and office equipment shipments totaled over $107 billion, a 16.2% increase from January-October 1997. Orders values increased by 20.3% during the same period. The value of shipments from communications equipment manufacturers fell 3.8% September-October. October shipments were 9.8% better than October 1997. Through October, communications equipment industry shipments ran 10.7% ahead of the 1997 pace. Orders expanded at 11.2% during the past year. The dollar value of shipments from U.S. electronic components' manufacturers (SIC 367) increased 2.5% September-October. The value of SIC 367 October orders was 5.0% better than September's level. October industry shipments were 12.6% better than October 1997, while orders improved 17.0% over the same period. The dollar value of total worldwide semiconductor sales fell 11.4% September-October, but the longer-term trend continues to improve. Between the same two months of 1997, semiconductor sales faded 19.7%. October sales were off only 2.1% from October 1997; during the previous seven months, dollar sales averaged 13.3% less than in the same period in 1997.

Key points:

• Dedicated foundry spending will increase to $5.0 billion in 1999.
• Dedicated foundry spending was 14% of total spending in 1998 and will increase to 16% in 1999.
• Compound annual growth rate ('92-98) of foundry spending was 73%.
• Compound annual growth rate ('92-98) of total capital spending was 16%.
• Growth in dedicated foundry capital spending will continue to outpace the rest of the industry.

Strategic Marketing Associates is a market research company whose focus is on the fab. For information about capital spending and new fab projects, contact Strategic Marketing Associates at 831-464-2669.