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Global chip sales continued to recover in May with sales up 4.5 percent from April and 47.6 percent from a year ago, according to the Semiconductor Industry Association.

Sales in May were $24.7 billion, up from $23.6 billion in April and $16.7 billion in May, 2009, according to the chip industry’s trade group. Chip sales are a bellwether for the technology industry since chips are used in everything electronic.

All monthly sales numbers represent a three-month moving average, a statistical smoothing technique. The semiconductor industry is on track to hit the SIA’s forecast of 28.4 percent growth to $290.5 billion in 2010, said George Scalise, president of the SIA.

Chip sales have been buoyed by sales of PCs, cell phones, corporate information technology, industrial applications and autos. Unit sales of personal computers, buoyed by the launch of Microsoft’s Windows 7 operating system last fall, are now expected to grow by 20 percent in 2010 and cell phone unit sales are expected to be up 10 percent to 12 percent. That’s remarkably strong, given the sputtering U.S. economy with its persistent high unemployment.

But Scalise said that emerging markets such as China and India are fueling sales of PC and communications products. The car market is recovering after several weak years, and corporate buyers are purchasing equipment again after delaying purchases at the onset of the recession.

In the second half of 2010, Scalise said year-on-year and sequential growth rates are likely to slow, as the overall market was very depressed in the first half of 2009 and so numbers for that period were easy to beat. The recovery started in the second half of 2009. Scalise said that concerns about government debt, declining consumer confidence, and pressures on government spending are worth watching as the chip industry is sensitive to macroeconomic conditions.


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