Semiconductor Sales Exceed $20 Billion in July

by Semiconductor Industry Association

WORLDWIDE MICROCHIP SALES UP 11.5 PERCENT FROM JULY 2005

SAN JOSE, Calif. – September 1, 2006– Worldwide sales of semiconductors totaled $20.1 billion in July, up over 11.5 percent from July 2005, the Semiconductor Industry Association (SIA) reported today. July’s sales represent an increase of 1.8 percent from the $19.8 billion in sales reported in June 2006.

“The worldwide semiconductor industry is on track to surpass $240 billion in sales this year, which represents a new record,” said SIA President George Scalise. “Growth continues to be strong across a broad range of end markets and geographic regions as well, particularly Asia Pacific which is up over 13 percent year on year, and the U.S. where sales increased almost 18 percent over last year,” said Scalise.

“Capital spending and capacity utilization continue to be in balance,” Scalise noted. Capital spending in 2006 is expected to amount to approximately 22 percent of semiconductor sales, which is in line with anticipated technology requirements and anticipated sales growth. Capacity utilization edged up slightly in the second quarter of the year, from 89 percent to 91 percent, with leading-edge capacity at 97 percent.

“July sales reflect the historical pattern for the industry with growth in unit demand coupled with declining average selling prices. This trend helps make possible the very attractive prices for many consumer products. For example the average selling price for a PC declined by approximately 7 percent year over year,” noted Scalise. Computer products represent over 40 percent of demand for semiconductors.

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