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May 21, 2019
After 2Q19 Bottom, Expectations Increase for a 3Q19 IC Market Rebound
Notably, the IC market has never shown more than three sequential quarters of decline.
IC Insights will release its May Update to the 2019 McClean Report later this month. This Update includes a discussion of the 1Q19 IC industry market results, a detailed quarterly IC market forecast for the remainder of this year, and a look at the top-25 1Q19 semiconductor suppliers.
Over its 60-year history, the IC industry is well known for its cyclical behavior. Looking back to the mid-1970s, IC Insights cannot identify a period where the IC market declined for more than three quarters in a row. Assuming the 2Q19 IC market registers a slight decline of 1% as compared to 1Q19, the 4Q18-2Q19 timeperiod would mark the sixth three-quarter IC market drop on record (Figure 1).
As shown, there hasn’t been a three-quarter decline in the IC market since 2001. Moreover, the three-quarter decline in 2001 was the steepest on record, with three double-digit declines, which led to the most severe annual IC market drop in history with a 33% plunge.
Given that the IC industry has never registered a four-quarter sequential IC market decline, expectations are high for a rebound in IC market growth beginning in 3Q19. While the U.S. and China trade war is an unpredictable “wildcard” for near-term IC market growth scenarios, 3Q19 is currently expected to display the largest percentage growth in the quarter after a three-quarter downturn in IC industry history. However, even with a strong rebound in IC sales in 2H19 as compared to 1H19, the total IC market is forecast to drop by 13% this year, with more downside than upside risk to this forecast.
Report Details: The 2019 McClean Report
Additional details on current IC market trends are provided in the May Update to The McClean Report—A Complete Analysis and Forecast of the Integrated Circuit Industry. A subscription to The McClean Report includes free monthly updates from March through November (including a 250+ page Mid-Year Update), and free access to subscriber-only webinars throughout the year. An individual user license to the 2019 edition of The McClean Report is priced at $4,990 and includes an Internet access password. A multi-user worldwide corporate license is available for $7,990.
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