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Employing the September actual global semi sales of $27.8 billion reported, the updated monthly forecast expectation for 2012 total global semi sales is expected to be $291.76 billion as calculated by the Cowan LRA forecasting model. This latest derived update to the 2012 sales forecast estimate corresponds to a year-over-year sales growth expectation of minus 2.6 percent, down from the previous month's year-over-year sales growth forecast estimate of minus 1.7 percent.
The latest forecast is also much lower than the joint WSTS/SIA Spring 2012 sales growth market forecast (published in June) of plus 0.45 percent, which corresponds to a global sales forecast estimate of $300.9 billion. Therefore, the Cowan model's latest monthly sales forecast output (based on the just announced September 2012's actual sales) continues to project more negative sales growth for 2012 relative to 2011 and has exhibited a downward sales and sales growth trend for the fifth consecutive month.
The model's previous month's forecast expectation for September's actual sales was $29.8 billion. This sales number generated last month was much higher than the just-published actual September sales of $27.8 billion. This results in a Momentum Indicator (MI) of minus 6.8, implying that the sales growth trend will be marginally down (that is, more negative) over the near-term forecast horizon.
Inputting September's just-published actual sales number into the Cowan LRA forecasting model also produces the latest updated sales and growth forecast expectations for the final quarter of 2012 as well as for the four quarters of 2013. These results are summarized in the first table included here. Also provided in the table are the corresponding previous month's sales and sales growth forecast numbers, thereby providing back-to-back monthly forecast estimate comparisons.
As displayed in the table above, the latest projected full-year 2012 global semi sales forecast estimate fell to $291.9 billion from last month's sales forecast expectation of $294.6 billion — a decrease of $2.7 billion or down sequentially by 0.9 percent. Correspondingly, the updated 2012 sales growth forecast expectation declined to minus 2.6 percent from last month's sales growth forecast estimate of minus 1.7 percent, a decrease of 0.9 percentage points — that is, falling into more negative territory compared to last month's forecast estimate.
Also, October sales are projected to be $23.96 billion. Therefore, October's sales forecast equates to a 3 months moving average (3MMA) sales expectation of $24.9 billion, which is up slightly from September's 3MMA sales result of $24.8 billion. It should be emphasized that this forecasted October 3MMA sales result assumes no (or very minimal) sales revisions to either the August or September actual sales numbers just published by the WSTS.
Additionally, according to the WSTS, year-to-date cumulative sales (total yearly sales through September) came in at $217.2 billion compared to last year's year-to-date cumulative sales number of $228 billion. This equates to a 2012 year-to-date (through September) sales growth rate of minus 4.7 percent. This implies that global semiconductor sales for the final fourth quarter of 2012 will have to exhibit significant strength to reach last year's overall sales number of $299.52 billion in order that the full year's 2012 sales might break even with last year's sales — let alone show a mildly positive sales growth for the year.
To be more precise, the latest Cowan LRA model's sales forecast expectation for the fourth quarter of 2012 is predicted to come in at $74.5 billion. When coupled with the actual third quarter sales of $74.4 billion it corresponds to a 2012 second half sequential sales growth forecast estimate of 4.2 percent. Therefore, fourth quarter global semiconductor revenue would need to come in at $82.4 billion or more in order to assure a positive sales growth for 2012 relative to 2011 — a highly unlikely scenario compared to historical experience.
Remember that the Cowan LRA Model's monthly forecast numbers do not “sit still” but will change each month, thereby reflecting the latest, most up-to-date actual monthly sales numbers published by the WSTS as the year plays out.
I suppose the semi sles decline can be attribute to more integrated solutions offered by chip suppliers. The tablets are replacing the desktop and laptop computers which means the overall semiconductor components used will be lesser. I don't really look only at the sales to understand the market, rather we should delve into details of the profits made by leading semiconductor companies.
“Greennovation” -that is a good newly coined term which will become the buzzword of tomorrow when more and more companies will focus on envirnment friendly production, or corporate facilities.
@prabhakar_deosthali:
Apart from being a buzzword it has some serious implications. Companies are trying to become more socially and ethically active these days. Hence, they are focusing on Green.
Companies need to harness the power of the employees by educating everyon ein green awareness. if everyone is following the same stroke then bigger improvements will be possible.
Figueroa, there is no doubt that companies has to move towards more ecco friendly operation and to save our natural resources. Now a day's based on such operations, there are some agencies, which will rate the company like, Diamond, Platinum, Gold etc.
@FLYINGSCOT: Employee buy-in is extremely valuable when changing corporate values surrounding the environment. Smith's greenovation was driven by an internal committee called the Smith Sustainability Group (SSG). The committee's objective was to educate employees and build awareness surrounding Smith's environmental goals and then encourage employees to take action. This group helped Smith identify and implement environmentally efficient and sustainable innovations that have ultimately transformed Smith's internal culture.
@Jacob: As more and more companies within the electronics industry seek partners with similar green values, the importance of organizations who rate and validate these key partners will, in turn, become increasingly valuable. As an e-Steward, Smith & Associates agrees to always make best efforts to work with e-Stewards Recyclers, ensuring that we don't contribute to the global toxic waste crisis. E-Stewards Recyclers undergo a professional audit every year to guarantee they do not export hazardous recycling byproducts to developing countries, use U.S. prison labor, or dump in municipal landfills. E-Stewards Recyclers also ensure that private data is kept secure, and that their operations protect both workers and the environment.
@Rich Krajewski: Small steps toward environmental change can have a big impact. The first step is awareness and making the environment a priority. Our movement started with a goal to be an energy-neutral, zero-waste company. Although we have not yet reached our goal, incremental progress is our path forward and feels like a win for Smith and for the environment. Technology is always evolving with newer, faster products constantly being introduced into the market, but there are steps we can take in addition to recycling to handle technological growth and advancement in an environmentally responsible manner. For example, Smith offers services to our customers for IT Asset Disposition (ITAD) that take important steps to avert EOL product from being sent to landfills or falling into the hands of counterfeiters. Practices like these, in combination with recycling and waste diversion efforts (such as e-Stewards Recyclers), are gaining the momentum needed to change the way our industry thinks about EOL product and disposal.
I suggest baby steps. Like convincing folks, including engineers and other well educated folks that man is leaving negative imprints on the environment or that global warming exists!
Art, The people who are very likely to doubt the importance or embrace efforts to limit the impact of our discarded products on the environment include engineers and other professionals. A company cannot mandate that people believe in global warming, for instance, or force them to recycle if they don't see value in it. How do you get employees to embrace this without sounding like a tyrannical boss?
Then we're back in the climate of men-behaving-badly-because-they-can, aren't we? I grew up in a place like that and the mayhem that's resulted from everyone looking out only for themselves is crippling. I left. I don't believe we've reached that level here but isn't that also why we are better than those who would either live a lawless life or flout the law wconvinced there are no repercussions?
@Bolaji Ojo: At Smith, we recognize that there is tremendous interest and innovative ideas from our employees, and that is how our self-directed Smith Sustainability Group (SSG) came into existence. As you rightly point out, corporate sustainability is not a top-down event, it is best formulated, engaged, and successful when it involves the entire organization – from ideas to planning to meeting goals. As such, SSG is tasked with setting Smith's environmental goals (rather than having these goals imposed from above), building green education and awareness for employees, and implementing programs that encourage employees to take sustainable action. As part of this, SSG developed Smith's Green Bag Lunch Series, available to Smith employees, which launched in October 2012. The most recent speaker was Houston Sustainability Manager, Lisa Lin, who spoke on various sustainability issues and green events in Houston.
Rich,
Greed is always the enemy. When we humans can learn the art of humility, then we can get to the point where people are beneath profits.
Art, again recycled usage of components and devices are very unhealthy especially when it handled by public. I personally feel that “Green movements” won’t limit to recycling the wastage or products. It can extend the visibility to other areas like using as much of natural lighting sources and power generations, minimizing the usage of paper, creating more ecco friendly working atmosphere etc.