As Intel prepares to launch faster chips, it looks as though the international semiconductor market is in slowdown, according to a report released this week.
Yesterday saw the chip giant release two high-speed Pentium 4 processors, clocked at 1.8Ghz and 1.6Ghz. The company said that a 2Ghz release is on the cards for the next few months.
Analysts have said that PC retailers will favour the new chips as faster alternatives to AMD's Athlon, which is currently lagging behind at 1.4Ghz. But there are doubts as to whether Intel's new chips will make any impact on slumping sales figures.
A report by Mercury research found that Intel only shipped about one million Pentium 4s in the first quarter of 2001, and is only expected to ship around two million in the second quarter and around 14 million for the whole year. These figures are well below Mercury's forecast of 20 million chips shipped this year.
A report released yesterday by the Semiconductor Industry Association (SIA) shows that the same black cloud hangs over the entire industry, and not just Intel.
The value of worldwide semiconductor sales totalled $12.71bn in May, a decrease from $15.90bn a year ago, the report said. On a month-to-month basis, May sales were 7.3 per cent below the April 2001 level of $13.72bn. Sales in the European market were down by 16.6 per cent.
"The sales for May reflect the current inventory overhang that the semiconductor industry has been experiencing since November," said SIA president George Scalise.
"We continue to believe that the industry will begin to see the final phases of the inventory correction late in the third quarter, with a broad-based sequential recovery commencing in the fourth quarter," he added.
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