Sat, Dec 10, 2005 - Page 10 News List

Semiconductor sales expected to grow 15 percent in Q4

By Lisa Wang  /  STAFF REPORTER

Sales of domestic semiconductor companies are expected to grow by around 15 percent in the final quarter of the year, fueled by rising seasonal demand and the improving economy, according to a report released by a local semiconductor industry association.

The forecast is based on the improving macroeconomic outlook, the Taiwan Semiconductor Industry Association (TSIA, 台灣半導體協會) said in its latest report, issued late on Thursday.

"Though there are still some uncertainties about the economic recovery, we are not as pessimistic as before," TSIA said.

"Sales in the Taiwanese chip industry should recover gradually in the fourth quarter of 2005, boosted by seasonal demand," the association said.

Local chip companies' sales will increase to NT$33.76 billion (US$1 billion) during the period from October to this month, compared with NT$29.25 billion in the third quarter, according to the TSIA's projection.

The association is comprised of more than 140 local semiconductor companies, including the world's top contract chipmaker, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電).

TSMC said on Thursday that its sales for last month leapt 31.1 percent to NT$27.52 billion from NT$20.99 billion a year ago, which also meant a 4.9 percent increase from October. Rival United Microelectronics Corp (聯電) said on Wednesday its sales rose 1.4 percent last month to NT$9.41 billion from NT$9.28 billion a year earlier, the first increase in 11 months.

The total third-quarter sales of local semiconductor companies represented 18 percent growth quarter-on-quarter, but a 1.4 percent decline from a year earlier, according to the TSIA report.

The association predicted that sales for the full year would inch up 1.29 percent to NT$1.11 trillion from NT$1.09 trillion last year.

The association did not provide its forecast for next year.

Growth in the nation's semiconductor sector is expected to gather steam next year, helped by rising demand for communications devices, the Industrial Technology Research Institute (ITRI, 工研院) said earlier this week.

"We are optimistic about the Taiwanese semiconductor industry next year," ITRI said, adding that the industry had already hit the bottom of the curve earlier this year.

ITRI predicted the year-on-year sales increase would expand to 10 percent next year compared with this year, in contrast to less than 2 percent this year.

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