November Chip Sales Up 11.3 Percent

by Semiconductor Industry Association

SIA says consumer product sales remained strong

SAN JOSE, Calif. – January 2, 2007- The Semiconductor Industry Association (SIA) today reported that global sales of semiconductors reached $22.7 billion in November, an increase of 11.3 percent from the $20.4 billion in November 2005. Sales increased by 3.1 percent from the $22.0 billion reported in October. The November sales figure was the fifth-consecutive month of record sales. For the first 11 months of 2006, worldwide semiconductor sales totaled $225.1 billion, an increase of 9.4 percent from the like period of 2005 when sales were $205.7 billion.

Consumer applications continued to drive demand of microchip sales in November. According to the Consumer Electronics Association (CEA), unit sales of consumer electronic products such as flat-panel displays and digital cameras were ahead of forecasts in the holiday season and resulted in strong revenue growth despite some erosion in the average selling price for some products. The CEA reported that November unit sales of digital cameras in the U.S. market were up 30 percent over November 2005 and up over 40 percent for the first 11 months of 2006. Semiconductor product lines that showed strong sequential growth included DSPs (digital signal processors), up 12.3 percent; DRAMs (dynamic random-access memories) up 6.8 percent; NAND flash up 6.3 percent; and microprocessors, up 4.3 percent.

“Despite some signs of slower economic growth in the fourth quarter, consumer purchases of electronic products remained strong and again drove semiconductor sales to record levels,” said SIA President George Scalise. “The latest Conference Board survey of consumer confidence reflected increasing optimism. An improving job market and indications of healthy economic growth going forward should contribute to stronger demand for semiconductor products which are increasingly driven by consumer electronic purchases.

“Inventories are in line with current demand in most major product segments, and there are even signs of tight supplies in some memory products,” Scalise continued. “Global sales of semiconductors for the first 11 months of 2006 are in line with the SIA forecast of 9.4 percent growth for the year. 2007 is shaping up to be another good year for the industry with a forecast of 10 percent growth over 2006,” Scalise concluded.

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THE SIA GLOBAL SALES REPORT

The SIA’s 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, which represents approximately 66 companies. 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 and SIA member companies comprise more than 85% of the U.S. semiconductor industry. Collectively, the chip industry employs a domestic workforce of 225,000 people. More information about the SIA can be found at www.sia-online.org

SIA CONTACT

John Greenagel
408-436-6600
mailbox@sia-online.org

Anne Craib
408-436-6600
mailbox@sia-online.org