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Gartner sees chip industry slowing

Gartner sees chip industry slowing

Gartner sees the chip market slowing but plans to leave its 2008 revenue growth forecast unchanged.

Slower consumer spending on electronics will slow semiconductor market growth this year, a Gartner analyst said Monday -- but the market researcher will likely leave its chip market forecast for 2008 little changed when it publishes an update this week.

"We do not believe that the semiconductor industry can remain completely immune to the macroeconomic environment," said Gartner analyst Richard Gordon in the market researcher's Semiconductor Monday DQ Report.

"We expect business and consumer spending on electronics to slow in coming quarters, and semiconductor market growth to remain muted," he added.

The market researcher's prior forecast for 2008 semiconductor revenue growth stood at 3.4 percent to US$278.4 billion the last time it revised its estimate in March. Previously, Gartner had predicted growth of 6.2 percent.

Gordon wrote that the current forecast will likely not change despite strong revenue growth in the chip industry during the first half of this year.

The market researcher fears that the credit crunch on housing markets in the West and high energy prices will hurt consumers worldwide, leading to slower spending on electronics gear.

Even emerging markets such as China, India, Russia and South America, which have bolstered PC and mobile phone sales this year, will slow, Gordon said in a note two weeks ago.


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