By | Tony Smith 5th November 2004 11:03

Intel's Barrett looks for chip sales growth in '05

So does market watcher iSuppli

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Intel CEO Craig Barrett believes the current inventory correction being experienced by the chip industry does not herald a slowdown and has said he takes forecasts of flat sale growth through 2005 "with a grain of salt".

Speaking at a Semiconductor Industry Association (SIA) meeting this week, Barrett said: "I don't think the inventory correction is a euphemism for a slowdown."

Chip demand prediction remains an inexact science, he said. "We don't make forecasts," he added. "I take the SIA forecast with a grain of salt."

Earlier this week, the SIA lowered it 2004 global chip sales forecast to $213.8bn from $214bn. It also said it expects 2005's total to be much the same as that, with sales rising again in 2006, by 6.3 per cent. It had previously predicted a 4.2 per cent increase in 2005, followed by a 0.8 per cent dip the year after.

Barrett's expectations seem mirrored by market watcher iSuppli, which has reiterated its bullish September forecast for growth of 9.6 per cent during 2005.

In an EE Times interview, Dale Ford, iSuppli's VP of market intelligence services, said the growth will arise in part because a broader array of memory products will allow vendors to continue to pump out chips without having to flood a particular market.

"In the past, memory suppliers would keep the lines running, now they can reallocate production capacity," he said.

iSuppli believes chip sales will hit $208.8bn this year, up 25.5 per cent on 2003's total, $166.4bn, and well below the SIA's forecast. ®