chip world

Worldwide semiconductor chip sales fell 2.7 percent to $291.6 billion in 2012, down from the record sales of $299.5 billion in 2011, according to the Semiconductor Industry Association.

The industry trade association was upbeat about the number since it beat forecasts and could have been worse in the face of substantial macroeconomic weakness. The group says that near-term economic and policy uncertainty poses risks for the near-term market outlook. The numbers are a bellwether for the tech economy, since chips are the foundation of electronic devices.

As a region, the Americas showed strength, with sales increasing 13.4 percent in December compared to a year ago, and sales in the Americas were up 12 percent compared to the previous quarter. But for all of 2012, the Americas were down slightly. U.S. sales are more than $150 billion, and the U.S. employs about 250,000 people in the chip industry.

The 2012 sales were the third-highest ever, but fell shy of the long-term goal of hitting $300 billion in sales. Global sales in December were $24.7 billion, down 3 percent from the previous month. Fourth-quarter sales were $74.2 billion, up 3.8 percent from $71.5 billion a year earlier. All monthly sales numbers represent a three-month moving average (a technique to smooth anomalies).

“Despite substantial macroeconomic challenges, the global semiconductor industry outperformed forecasts and posted one of its highest yearly sales totals in 2012,” said Brian Toohey, president and chief executive of the Semiconductor Industry Association. “Recent momentum, led by strength in the Americas, has the industry well-positioned for a successful 2013.”

Some segments were strong. Logic, the largest category, was $81.7 billion in 2012, up 3.7 percent from the previous year. MOS microprocessors (such as the kind that Intel makes for the brains of a computer) were $60.2 billion, down from a year ago. Memory chip sales were $57 billion, also down from a year ago.

Optoelectronics was the fastest growing market on a yearly basis, increasing 13.4 percent in 2012 to reach $26.2 billion for the year. Those include mobile device applications and LED lighting chips that improve the energy efficiency of lighting. s. NAND flash memory chips — used in mobile devices, USB flash drives, memory cards and related products for the storage and transfer of data — grew at the second-fastest rate of 4.1 percent to reach $25.4 billion in 2012.

Sales in Asia-Pacific increased in December by 6.7 percent compared to a year ago, but Europe fell 5.5 percent and Japan decreased 11.2 percent. Total yearly sales in all four regions were lower in 2012 compared to 2011.

“Despite lingering economic and policy uncertainty, the U.S. semiconductor market continues to show signs of strength, posting impressive growth in December,” said Toohey. “As the foundation of all modern electronics, semiconductors are critical to America’s economic strength, national security and global competitiveness. By enacting measures that foster growth and remove uncertainty, policymakers can further strengthen the industry and help unlock its full potential in 2013 and beyond.”