Semiconductor revenue in the wireless market is expected to grow by 16.7%
Worldwide semiconductor revenue will grow marginally by 2.9% to $313.3bn in 2011, up from $304.5bn in 2010, according to the latest IHS iSuppli Application Market Forecast Tool (AMFT).
This projected growth is slightly less the previous forecast of 4.6% issued on August.
The sluggish growth projection is attributed to increasing economic woes and rising consumer pessimism that are impacting global electronics demand this year.
IHS vice president for electronics supply chain and semiconductors Dale Ford said, unfortunately, the accelerating decline and instability of the economy has reasserted itself as the primary driver of tepid electronics and semiconductor revenue growth in 2011.
"The continuing impact of a weakened and stagnant economy is expected to continue to drag on the semiconductor market in 2012, limiting revenue growth to 3.4%," Ford said.
The drop in the growth in the electronics and semiconductor market in 2011 is similar to the sudden drop in the business that started in the middle of the third quarter of 2008.
IHS said an annual decline in suppliers’ market revenue may be avoided by agile adjustments in business strategy in 2011.
IHS said the near term rebound of the Japanese semiconductor market is expected to provide a modest second-half boost to the worldwide semiconductor market.
However, IHS maintains that the semiconductor market growth will be flat for 2011 if the economy falls into recession this year.
Semiconductor revenue in the wireless market is expected to grow by 16.7% in 2011 driven by rapid growth in smartphone and media tablet shipments.
IHS indicated that semiconductor revenues in wired communications, consumer electronics and automotive electronics are expected to fall in 2011.
IHS sees strong double-digit growth for NAND flash, image sensors, light-emitting diodes (LEDs) and other sensors, while predicts a revenue decline of 18% for dynamic random access memory (DRAM).