Worldwide Semiconductor Sales for January 2001 13.7% Higher Than January 2000; Recent Sales Reflect Inventory Overhang, Deceleration of Demand

Business Wire, March 5, 2001

Business Editors/High-Tech Writers

SAN JOSE, Calif.--(BUSINESS WIRE)--March 5, 2001

Worldwide sales of semiconductors came in at $16.87 billion in January 2001, an increase of 13.7% over $14.84 billion a year ago, the Semiconductor Industry Association (SIA) reported today. On a sequential basis, January sales were 5.7% below the December 2000 level of $17.89 billion.

"The industry is currently experiencing lower sales due to an inventory overhang and deceleration in the end-equipment markets," stated George Scalise, SIA president. "Current forecasts suggest the inventory adjustment will be completed by the end of the third quarter, and end-market product demand will improve later in the year."

The factors causing the current decelerating sales are reflected in each semiconductor product sector and in every geographic region. Compared to January 2000, this January the Japanese market grew 23.2% and the Asia/Pacific market 2.9%. The Americas market rose 15.4% and the European market 14.6%.

From its beginning in the 1950s, the semiconductor industry has been characterized by a four-year cycle, sporadically modified by unexpected economic factors. The semiconductor industry has grown at a compound annual growth rate (CAGR) of 17% over the past 40 years.

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 about 70 companies. The moving average is a mathematical smoothing technique that mitigates variations due to companies' monthly financial calendars.

About the SIA

The SIA is the leading voice for the semiconductor industry and has represented U.S.-based manufacturers since 1977. SIA member companies comprise more than 90% of U.S.-based semiconductor production. Collectively, the chip industry employs a domestic workforce of 284,000 people. More information about the SIA can be found at www.semichips.org.

January, 2001
Billions

Month-to-Month Sales

Market                   Last Month     Current Month      % Change

Americas                       5.55              5.23         -5.8%
Europe                         3.73              3.62         -2.7%
Japan                          4.31              4.05         -5.9%
Asia Pacific                   4.30              3.97         -7.9%

Total                         17.89             16.87         -5.7%


Year-to-Year Sales

Market                    Last Year     Current Month      % Change

Americas                       4.53              5.23         15.4%
Europe                         3.16              3.62         14.6%
Japan                          3.29              4.05         23.2%
Asia Pacific                   3.85              3.97          2.9%

Total                         14.84             16.87         13.7%



Three-Month-Moving Average Sales

Market                Last 3 Months   Current 3 Months     % Change

Americas                       5.90              5.23        -11.3%
Europe                         3.79              3.62         -4.5%
Japan                          4.35              4.05         -6.9%
Asia Pacific                   4.60              3.97        -13.9%

Total                         18.65             16.87         -9.5%