Memory slows semiconductor industry growth

By Jim Carbone -- Purchasing, 3/19/2008 11:03:00 AM

The final numbers are in and the global semiconductor market grew only 3.3% to $268.9 billion in 2007, according to iSuppli’s final 2007 chip market share data.

The meager growth was due in part to a decline in DRAM and flash memory prices and total revenue, especially in the fourth quarter.

Worldwide DRAM revenue fell by 19.1% in the fourth quarter compared to the third. Meanwhile, NAND flash revenue declined by 3.9%. This caused overall memory chip revenue in the fourth quarter to decline 11% sequentially. For the year, memory revenue fell from $59.8 billion to $57.4 billion.

“This was a complete role reversal for memory semiconductors compared to 2006,” said Dale Ford, senior vice president, market intelligence, for iSuppli. “During the second half of 2006, memory IC revenues helped to prop up the growth of the overall semiconductor industry. In 2007, the poor results for memory chips restrained overall market growth.”

Weak market conditions had a major impact on most memory suppliers in 2007, including Nanya Technology and Qimonda, which saw their memory IC revenues fall by 32.4% and 26% respectively for the year.

The world’s leading supplier of memory chips, Samsung Electronics Co. Ltd. of South Korea, experienced a decline of 3.3% in its memory semiconductor revenue in 2007—contributing to a 0.8% decline in total chip revenue for the year.