July Chip Sales up 7.6 Percent Year-on-Year

by Semiconductor Industry Association

SIA SAYS SALES OF CONSUMER ELECTRONICS, PCS AND CELL PHONES DRIVING DEMAND

SAN JOSE, CA – September 2, 2008 – Worldwide sales of semiconductors grew by 7.6 percent to $22.2 billion in July from July 2007 sales of $20.6 billion. Sales grew by 2.8 percent from June when sales were $21.6 billion.Year-to-date sales through July were $148.3 billion, an increase of 5 percent from the same period of 2007 when sales were $141.3 billion.

“Growing sales of consumer electronics, personal computers and cell phones – which account for about 80 percent of chip demand – contributed to a healthy 7.6 percent year-on-year increase in worldwide microchip sales,” said SIA President George Scalise. “LCD TV units are projected to increase 32 percent this year, and digital set top boxes and digital still cameras will both be up around 20 percent. Taking into account PC unit growth of about 13 percent and cell phone growth of over 10 percent, we are enjoying the benefits of the strong 3.3 percent second quarter GDP growth in the U.S ,and continued strength in world markets” Scalise continued.

“For the second quarter of this year we’ve seen a significant crossover – 300mm for the first time accounts for the largest share of wafer manufacturing capacity and actual wafers processed, with 44 percent of total capacity and 47 percent of total silicon processed,” Scalise noted. “Overall capacity utilization remains high at 89 percent – with leading edge above 95 percent” said Scalise.

SIA reported that sales of DRAMs and NAND flash memory continued to decline as a result of continuing price erosion. “Total semiconductor sales excluding memory products increased by 11.6 percent year-on-year and by 3.2 percent sequentially,” said Scalise. “The memory content of typical PCs and cell phones continues to increase. According to Micron Technology, the DRAM bit content of the average PC in 2008 will increase by 56 percent, while the NAND flash content for the average cell phone will grow by 178 percent,” Scalise concluded.

About the SIA Global Sales Report
The SIA Global Sales Report (GSR) is a three-month moving average of sales activity. The GSR is tabulated by the World Semiconductor Trade Statistics (WSTS) organization, an independent, non-profit organization established by the global semiconductor industry to compile industry statistics. The moving average is a mathematical smoothing technique that mitigates variations due to companies’ financial calendars.

About the SIA
The SIA is the leading voice for the semiconductor industry and has represented U.S. semiconductor companies since 1977. Collectively, the chip industry employs a domestic workforce of 216,000 people. More information about the SIA can be found at www.sia-online.org.

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For more information:
Semiconductor Industry Association
John Greenagel or Anne Craib
408-436-6600
mailbox@sia-online.org