BUSINESS

Growth forecasts for chip sales lowered again

By Song Su-hyun
  • Published : Sept 1, 2019 - 16:04
  • Updated : Sept 1, 2019 - 16:04

World Semiconductor Trade Statistics has again lowered its global sales forecasts for 2019 and 2020, indicating a longer-than-expected downturn in the chipmaking market, according to the industry on Sunday.

In its latest report, WSTS predicted that the global semiconductor industry would post annual sales of $406.5 billion this year, down 13.3 percent from last year.

Compared with the previous WSTS report, released in June, the estimates are also lower. 

(Samsung Electronics)

Memory sales are forecast to plunge 31 percent to $109 billion worldwide this year, leading the downturn, the latest report said.

In 2020, the market should show signs of recovery with estimated sales of $426 billion, 4.8 percent higher than this year, WSTS said.

However, forecasts for next year have been adjusted downward compared with the previous report.

Based in San Jose, California, WSTS is a nonprofit organization with around 40 semiconductor companies as members including Samsung Electronics, SK hynix, Micron and Toshiba.

In response to negative forecasts, Samsung recently notified its employees that their annual incentives for early next year are to be reduced.

For the past couple of years, the semiconductor division used to pay employees 50 percent of their salaries as a bonus in recognition of their work over the past year.

However, the amount has been adjusted to around 20 percent, according to company insiders, reflecting the current market downturn.

“The market was expected to start recovering in the second half of the year, but demand and prices are both showing slower-than-expected rebounds,” said an industry official. “If global trade disputes continue throughout the year, the downturn period could extend.”

By Song Su-hyun (song@heraldcorp.com)


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