Semiconductor inventory correction weakening sales warns Gartner
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On the back of relatively weak Q3 semiconductor sales, the inventory correction currently underway will continue to dampen sales prospects until the end of the year, according to Gartner.The market analyst forecasts that sequential growth will not occur until 2012 at the earliest.
Gartner's Index of Inventory Semiconductor Supply Chain Tracking moved further into the caution zone as levels hit 1.16 in Q3 2011, up from 1.12 in its initial update in September. Within the GIISST, an above days of inventory level of 1.10 indicates inventories are inflated, and there will likely be downward pressure on average selling prices (ASPs). Below the 0.95 level indicates that inventories are low, components may be on allocation, and double ordering begins.
Peter Middleton, principal research analyst at Gartner said: "We expect that ASPs for foundry produced components will be under pressure through the first half of 2012 because of aggressive investment in capacity made as the industry came out of the last recession. That investment is leading to excess capacity at the same time as concern is rising about end market demand levels due to weak economic prospects."
