DIGITIMES — The bottom of the current cycle in the worldwide economy and semiconductor industry was reached in the first quarter of 2009, but the "velocity" of the chip industry recovery is subject to debate, according to IC Insights. The discussion over the next few quarters will be about how much sequential growth can be expected, instead of how far the markets are going to fall.

 

The first-half 2009 was hit hard by seasonal weakness for electronic system sales, a major IC inventory adjustment, and the global recession at its worst (with the global economy registering a rare drop in GDP), IC Insights observed.

 

Since the beginning of the severe downturn that began nine months ago, IC Insights has encouraged industry players to think quarterly about 2009, or at least in halves. The research firm expects second-half 2009 to be much better than the first.

 

Worldwide GDP growth is forecast to be negative in 2009 (negative 0.8 percent), but the second half of the year is expected to register positive growth, according to IC Insights. The same pattern is also forecast for the US economy.

 

In China, the economy is expected to see its second-half GDP climb almost 9percent, said IC Insights. In fact, China's GDP growth is projected to be well over 9percent in the fourth quarter of 2009, the research firm added.

 

Handset and PC unit shipments are estimated to climb 18percent and 15percent, respectively, compared to the first half, IC Insights indicated. The seasonal jump in electronic system sales coupled with stable and increasing IC ASPs is forecast to spur an 18percent growth sequentially in the IC market in the second half of 2009, according to the research firm.

 

The IC foundry market is also expected to continue its substantial recovery in the second half of 2009, growing 43percent from the first, said IC Insights.

 

In fact, IC Insights pointed out that the IC market already enjoyed double-digit growth sequentially in second-quarter 2009, when the foundry sector almost doubled compared to the first quarter.

 

As a group, chip equipment suppliers have taken the worst "beating" of any of the companies involved in the current semiconductor industry downturn, according to IC Insights. However, the second half of 2009 will likely offer some relief for suppliers as semiconductor industry capital spending is forecast to jump by 28percent as compared to the first half. Many of the major semiconductor suppliers plan to spend the majority of their capex budgets in the second half of 2009, said the research firm.