Semiconductor sales surge on strong demand for memory
Inclusive of this, the monthly global semiconductor sales (GSS) has consistently stayed above the US$30 billion level for the past seven consecutive months since October 2016. MIDF Research
KUCHING: Semiconductor sales in April surged at a faster pace mainly due to strong demand for memory products.
According to the research arm of MIDF Amanah Investment Bank Bhd ( MIDF Research), April 2017 worldwide sales of semiconductors surged by 20.9 per cent year on year (y- o-y) to US$ 31.3 billion, marking the global market’s largest y- o-y growth since September 2010 when sales grew by 25 per cent y- o-y.
“Inclusive of this, the monthly global semiconductor sales (GSS) has consistently stayed above the US$ 30 billion level for the past seven consecutive months since October 2016.
“All markets posted strong double digit growth on a year- overyear basis of between 12 per cent y- o-y and 30 per cent y- o-y.
“The growth was mainly driven by the immense sales growth in the memory market,” MIDF Research said, adding that sales of non-memory products also grew by double digits in April 2017.
MIDF Research noted that Taiwan Semiconductor Manufacturing Company (TSMC) is reported to be looking into the production of next generation memory chips in addition to the current mainstream logic chips.
The research arm further noted that TSMC is planning to develop and produce high speed and low- power chips for emerging internet of things ( IoT), mobile device, high-speed computing and smart vehicle applications.
Meanwhile, MIDF Research highlighted that in recent years, the China’s government has been supporting the Chinese domestic semiconductor industry with tremendous capital budgets.
“This has led to China gradually playing a pivotal role in upholding the demand of semiconductor products,” it said.
“At present, sales from China has accounted for one-third of global sales. It is also the main export destination of Malaysia semiconductor products.”
Moving forward, MIDF Research expected the sales growth momentum emanating from China to remain robust in the foreseeable term.
The research arm noted that this is in-tandem with the anticipated heavy investment in fab equipment in the upcoming years.
In the immediate term, MIDF Research expected the global semiconductor sales to continue to record positive sales growth on a year- over-year basis.
Apart from the smart devices segment, the research arm also expected healthier demand from the automotive, storage and healthcare markets.
The automotive market will driven by the continuous effort to increase the average semiconductor content per vehicle.
“Demand from this market is also less susceptible to seasonality factors, thus providing a steadier stream of revenue,” it said.
“Meanwhile, higher demand for the storage market would be supported by the cloud computing and data centre industries.”
All factors considered, MIDF Research maintained its ‘ positive’ stance for the technology sector.