RPT-UPDATE 1-Global chip makers eye sales drop in 2009 -WSTS
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[November 18, 2008]

RPT-UPDATE 1-Global chip makers eye sales drop in 2009 -WSTS

TOKYO, Nov 18, 2008 (Reuters via COMTEX) --
Global sales of semiconductors are likely to fall
2.2 percent in 2009 due to weak demand for electronics worldwide, industry group
World Semiconductor Trade Statistics said on Tuesday, reversing its May forecast
of 5.8 percent growth.
Chip giants Intel Corp and Samsung Electronics Co Ltd are steeling
themselves for weak computer sales in the holiday season and beyond as the
economic crisis hits consumer sentiment.
The chip market will shrink to $256 billion next year, down from an
expected $261.9 billion in 2008, said WSTS, whose 66 member chip makers make up
roughly 80 percent of the global chip market.
Semiconductor companies worldwide are cutting output and capital
spending. Taiwan Semiconductor Manufacturing Co , the world's largest contract
chipmaker, said earlier on Tuesday that it had frozen hiring after posting its
biggest decline in monthly sales.
Sales of microchips are expected to fall 9.8 percent in the Americas next
year, trailed by a 3.8 percent decline in Japan and a 3.6 percent fall in
Europe, the WSTS said.
Sales in the Asia-Pacific region will slow to 1.1 percent growth in 2009,
down from an expected 7.6 percent growth this year.
The industry group also cut its outlook for 2008 and 2010. Chip makers
now expect sales to grow an annual 2.5 percent in 2008, down from a previous


outlook of 4.7 percent, as sales stall before the year-end holidays and
inventory piles up, lowering prices.
The industry group also revised down its forecast for 8.8 percent growth
in 2010 to 6.5 percent growth to $273 billion.
When chip makers use fewer factory lines and equipment, this spells bad
news for suppliers of microchip-making equipment such as Applied Materials Inc
and Tokyo Electron Ltd .
(Reporting by Mayumi Negishi; Editing by Hugh Lawson) Keywords: CHIPS/

(mayumi.negishi@thomsonreuters.com; +81-3-6441-1812; Reuters Messaging:
mayumi.negishi.reuters.com@reuters.net)
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