Industry Forecast
Industry analysis from IC Insights
2007 Microcomponent Forecast
The microcomponents segment of the IC industry has become a mixed bag of market conditions for microprocessors, microcontrollers, and digital signal processors in 2007. New analysis in IC Insights’ Mid-Year Update breaks down the $56 billion microcomponents market segment in close analysis.
Back on track Microprocessors will see a modest recovery in 2007 after pricing competition eroded MPU revenues in 2006 and the first half of this year. Fig 2 shows a break down of the microcomponent market segments.
Thanks to solid demand for personal computers in 2007, microprocessor sales are now expected to increase 4% to $34.5 billion compared to $33.2 billion in 2006, when MPU dollar volume fell 5%. In 2008, microprocessor sales are forecast to grow 17% to $40.3 billion during the industry’s next cyclical peak growth year, according to IC Insights’ Mid-Year Update.
Microcontrollers will achieve new record-high sales in 2007 with MCU unit volume shipments surging 21% this year.
Worldwide microcontroller revenues are forecast to reach the $14 billion mark in 2007, a 13% increase from $12.4 billion in 2006. In 2008, MCU sales are expected to rise another 13% to nearly $15.8 billion, based on IC Insights’ midyear forecast.
The lows
Digital signal processors remain bogged down in another difficult year. DSP sales are expected to decline 5% in 2007 due to inventory corrections in cell-phone equipment markets. In 2006, DSP sales rebounded with a 9% increase after dropping 2% in 2005. DSP dollar volume is now expected to total $7.9 billion in 2007 compared to $8.3 billion in 2006. DSP unit volume remains relatively weak in 2007, with device shipments expected to grow 9% this year compared to an average annual growth rate of 18% between 2001 and 2006. In 2008, the DSP market is forecast to recover and display a 13% increase to $8.9 billion, according to IC Insights’ new report.
The microcomponents market accounts for about one quarter of worldwide IC sales. IC Insights’ forecast shows total sales in the microcomponents segment growing at a cumulative average growth rate (CAGR) of 9% per year between 2006 and 2011. Combined MPU/MCU/DSP sales are expected to reach $84.5 billion in 2011 compared to $56.4 billion in 2007.
