Chip Market Slowdown Takes Toll on Suppliers
 

Eight of the top 10 semiconductor suppliers saw posted annual declines in first quarter sales compared with the first quarter of 2015, with several seeing sales fall by 25% or more, according to a new ranking of chip vendors published by market research firm IC Insights Inc.

The semiconductor industry has been faced with a slowdown in market demand over the past several months. Overall, first quarter chip sales were down by nearly 6% compared to the first quarter of 2015, according to the Semiconductor Industry Association trade group. IC Insights estimates that first quarter chip sales declined by roughly 7%.

Six of the top 10 semiconductor sales leaders experienced year-over-year revenue drops of greater than 10%, according to the list compiled by IC Insights. The IC Insights top 20 supplier list includes integrated device manufacturers as well as three semiconductor foundries and six fabless companies.

Of the top 10 suppliers, only market leader Intel Corp., which saw its first quarter sales grow by 9% compared with the first quarter of 2015, posted a significant year-over-year sales increase in the first quarter, according to the IC Insights report. South Korea’s Samsung Electronics Co. Ltd., the No. 2 supplier of semiconductors, posted first quarter chip sales that were essentially flat with the first quarter of 2015, IC Insights (Scottsdale, Ariz.) said.

Cumulatively, sales from the top 20 chip suppliers declined by 6% in the first quarter compared with the first quarter of 2015, IC Insights said. Seven of the top 20 suppliers experienced a year-over-year revenue drop of 25% or more, the firm said.

Underscoring the current down cycle for memory chips, suppliers Micron Technology Inc. and SK Hynic Inc. posted the largest year-over-year declines in first quarter sales among the top 20 suppliers. SK Hynix posted a 30% year-over-year decline in sales, while Micron’s sales tumbled by 28%, IC Insights said.

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