Chip sales slump, but decline slows

George Scalise, SIA presidentSan Francisco  - Global sales of computer chips plunged 30 per cent in February compared to 2008, but there are signs that the worst of the slump might be over, the Semiconductor Industry Association said Friday.

The industry trade group said sales fell to 14.2 billion dollars in February from 20.3 billion dollars a year ago. Sales were down some 7.6 per cent compared to January
2009.

The slumping sales for the processors that are at the heart of electronic devices reflect the crisis in the global economy. SIA President George Scalise said he expected demand to remain well below 2008 levels for several quarters, followed by a gradual recovery.

"While it would be premature to conclude that the sales decline has hit bottom, there are some indications that the rate of decline has moderated from the final quarter of
2008," said Scalise.

He noted that demand dived from 2.4 per cent lower in October 2008, to 22 per cent lower in December.

Analysts agreed with Scalise's interpretation.

In the last three months of 2008, semiconductor sales rapidly decreased from 2.4 per cent in October to 22 percent in December.

"We interpret these latest numbers as an indication that we might indeed be approaching that bottom," said Wachovia analyst David Wong. "We continue to be hopeful that global semiconductor shipments will grow sequentially in the June quarter over the March quarter." dpa

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