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Global semicon sales to reach $302.02 billion in 2013: Cowan LRA model

February 18, 2013 5 comments

This is a continuation of my coverage of the fortunes of the global semiconductor industry. I would like to acknowledge and thank Mike Cowan, an independent semiconductor analyst and developer of the Cowan LRA model, who has provided me the latest numbers.

With the ‘closing out’ of the final, overall sales result for 2012 by the WSTS, the Cowan LRA model for forecasting global semiconductor sales has been updated to include the full complement of 2012’s monthly sales numbers, thereby incorporating 29 years of historical, global semiconductor (actual) sales numbers as gathered, tracked and published each month by the World Semiconductor Trade Statistics (WSTS) organization.

The necessary mathematical computations required to update the complete set of linear regression parameters embedded in the Cowan LRA forecasting model have been carried out.

The newly derived set of linear regression parameters reflect 29 years (1984 to 2012) of historical global semiconductor sales numbers as a basis of predicting future quarterly and full year sales and sale growth forecast expectations by exercising the Cowan LRA model.

Therefore, the table given here summarizes the model’s latest 2013 sales and sales growth expectations as a function of the model’s range (low, expected and high) for January 2013′s sales forecast estimates as generated by the newly, updated model’s linear regression parameters.

Source: Cowan LRA model, USA.

Source: Cowan LRA model, USA.

It is estimated that in 2013, the global semiconductor industry is likely to reach $302.022 billion, a growth of 3.6 percent.

Note that next month’s forecast will be based on January 2013’s actual sales number, which is anticipated to be released by the WSTS at the end of the first week in March. Once posted, the model will be rerun to yield the quarterly and full year sales, and sales growth expectations for 2013, respectively.

Global semicon sales forecast results: Cowan LRA model

September 5, 2009 1 comment

Friends, carrying on with my coverage of the fortunes of the global semiconductor industry, here’s the global semiconductor industry sales forecasts, by Mike Cowan. First of all, I would like to acknowledge Mike for sharing his findings and thank him for his continuous tracking of the semiconductor industry.

The just updated global S/C sales forecast estimates are based upon the recently-published July 2009 actual sales number released last Tuesday by the WSTS (posted Sept 1st on their website – wsts.org).

The table provided below summarizes the details of the latest, updated forecast numbers covering the next six quarters, that is, from 3Q09 through 4Q10, inclusively, as well as for the full years of 2009 and 2010.

As shown in the table, the latest forecast updates for years 2009 and 2010 chip sales forecast estimates both increased by +3.3 percent to $205.4 billion and $221.1 billion, respectively, compared to last month’s sales forecast estimates of $198.9 billion, and $214.9 billion, respectively.

These updated 2009 and 2010 chip sales forecast estimates correspond to yr-o-yr sales growth forecast estimates of -17.4 percent and +8.1 percent, respectively, which represent improvements compared to last month’s sales growth predictions of -20 percent and +8 percent.

Table summarizing latest Cowan LRA model's sales and sales growth forecast estimates for next six quarters

Table summarizing latest Cowan LRA model's sales and sales growth forecast estimates for next six quarters

It should be highlighted that July 09’s actual cumulative YTD sales (of $114.82 billion) growth (compared to last July 08’s actual cum YTD sales of $148.29 billion) came in at -22.6 percent, indicating that the model is projecting an improvement relative to today’s 2009 actual YTD sales growth number, for the full year.

Remember that the model is dynamic, that is, it is recalculated each month as the year plays out; therefore today’s latest, updated full year sales growth prediction will not sit still but will evolve over the coming months.

Finally, the model also projects a sales forecast estimate for next month, namely for August, 2009. Thus August’s (actual) sales forecast estimate is projected to be $16.96 billion, which corresponds to a 3MMA sales forecast estimate of $18.38 billion as normally published by the SIA. Read more…

Global semicon sales forecast results: Cowan LRA model

August 6, 2009 Comments off

Friends, carrying on with my coverage of the fortunes of the global semiconductor industry, here’s the global semiconductor industry sales forecasts, by Mike Cowan. First of all, I would like to acknowledge Mike for sharing his findings and thank him for his continuous tracking of the semiconductor industry.

The just updated global semiconductor sales forecast estimates based upon the recently-published June 2009 actual sales number released last Monday by the WSTS (posted Aug. 3, on its website).

The table below details the latest, updated forecast numbers covering the next six quarters, that is, from 3Q09 through 4Q10, respectively.

As shown in the table the latest update to the year 2009 sales forecast estimate increased by +1.4 percent to $198.9 billion (compared to the previous month’s sales forecast estimate of $196.2 billion).

This updated 2009 sales forecast estimate corresponds to an yr-o-yr sales growth forecast estimate of -20 percent, which represents a slight improvement compared to last month’s sales growth prediction of -21.1 percent.Sources: Actuals => WSTS; Forecasts => Cowan LRA Model (August 2009)

It should be highlighted that June 09’s actual YTD sales ($95.927 billion) growth (compared to last June 08’s actual YTD sales of $127.508 billion) came in at -24.8 percent indicating that the model is projecting an improvement relative to today’s 2009 actual YTD sales growth number, for the end of the year.

Remember that the model is dynamic, that is, is recalculated each month as the year plays out; and therefore today’s updated full year sales growth prediction will not sit still but will evolve over the coming months.

Finally, the model also provides a sales forecast estimate for next month, namely for July. Thus, July’s (actual) sales forecast estimate is projected to be $15.221 billion, which corresponds to a 3MMA sales forecast estimate of $16.930B as normally published by the SIA.

In addition to running his forecasting model each month, Cowan also “keep tabs” on a wide range of other semiconductor industry watchers (including both WSTS and SIA bi-yearly forecasts), thereby tracking what their respective predictions are for 2009’s sales growth (compared to 2008).Source: Mike Cowan

The table (as well as distribution graphic) summarizes (pictures) the 2009 sales growth forecast estimates for 21 other market researchers (besides Cowan himself).

As shown in the table, ongoing revisions for each market analyst are listed along with the latest updates over the past month — three during this time period — highlighted as (<== UPDATE).

As is evident from surveying the numbers for the group included in the table, the most update 2009 sales growth predictions range is relatively broad but with a strong “central tendency” hovering around a decline of approximately 20 percent (six forecasters).

Cowan has also “extended” the model for an additional quarter (that is, through 4Q10) in order to get a preview of what the model had to “say” about a sales (and sales growth)forecast for the full year of 2010.Source: Mike Cowan

Thus, as shown in the table above — see the bottom three rows of (underlined) numbers — 4Q10’s sales forecast is projected to be $54.853 billion and the full year 2010’s sales forecast is forecasted to come in at $214.925 billion, which yields a 2010 year-on-year sales growth of 8 percent.

It should be mentioned that the WSTS’s and SIA’s 2010 sales growth forecasts are projected to be 7.3 percent and 6.5 percent, respectively. Therefore, looks like the model’s 2010 sales growth forecast is slightly more bullish than the two industry organizations’ forecasts reported back in (the beginning of) June, 2009.

Global semiconductor sales forecast results: Cowan LRA model

June 12, 2009 Comments off

This is a continuation of my coverage of the fortunes of the global semiconductor industry. First of all, I’d like to acknowledge and thank Mike Cowan, an independent semiconductor analyst and developer of the Cowan LRA model, who has provided me the latest numbers.

The latest forecast estimates, as derived via exercising the Cowan LRA Model, are based upon the recently-released April 2009 actual global semiconductor sales by the WSTS (note — includes, by the way, very minor upward revisions — i.e., an increase in sales — for each one of the previous three months of the year: Jan., Feb., and Mar.).Source: Mike Cowan

As the high-level results table portrays (see above), the year 2009 sales forecast estimate “kicked up” strongly (by $8.52 billion) to $192.50 billion from last month’s sales forecast estimate of $183.99 billion with a corresponding improvement (increase) in the 2009 year-on-year sales growth forecast to minus 22.6 percent (from last month’s sales growth forecast estimate of minus 26 percent).

It should be pointed out that this latest updated sales growth forecast estimate (-22.6 percent) is in good agreement with the latest forecast revisions just released by Gartner (-22.4 percent), the WSTS (-21.6 percent), and the SIA (-21.3 percent).Source: Mike Cowan

Sales growth forecasts
It should also be highlighted that this month’s momentum indicator improved (increased) significantly to plus 19.6 percent. This is relatively good news when compared to the actual monthly momentum indicators from Oct08 through Jan09, that is, -12 percent, -26 percent, -35 percent, and -31 percent, respectively.

Historical tracking of this particular indicator over the past seven years is also available. The historical long-term trend correlates with the significant collapse in industry sales during the time period just mentioned; a corresponding reversal looks to be in the making based upon this month’s strongly positive momentum indicator (record high positive percent since Cowan has been running the model and tracking this particular indicator).

With this month’s momentum indicator (MI) moving into very high, positive territory, it bodes well relative to a possible relatively strong recovery in sales over the near-term.

Cowan mentioned in his last month’s analysis, that this monthly indicator bears continued watching over the coming months in order to monitor the trend in this indicator — in order to verify that the present very strong uptick is highly suggestive that a “turning point” in the industry’s near term sales is real and will be sustained.

However, the model’s next month (May 2009) predicted sales forecast estimate is projected to be $14.686 billion which would represent a yr-o-yr monthly sales growth of -27.5 percent — not very encouraging relative to sustainability of a sales improvement trend if the model’s May09 sales forecast is born out.

Time will tell! And, stay tuned for next month’s update.

P.S.: I will be getting into further conversations with Mike Cowan, as well as Future Horizons’ Malcolm Penn this month.

Feb. 09 global semicon sales forecast results: Ala Cowan LRA model

April 20, 2009 Comments off

This is an addition to the continuing coverage on the global semiconductor industry forecasts in form of a monthly update to the Cowan LRA Model’s global semiconductor sales forecast numbers.

Mike Cowan, an independent semiconductor analyst and developer of the Cowan LRA model, has provided the latest numbers the model has “spit out” based upon the recently published (by WSTS) Feb 2009. actual sales number.

Key points:

1. FEB09 actual sales number ($13.456B) came in in excellent agreement with last month’s sales forecast estimate (of $13.446B) which represents a plus 0.077 percent delta comparing the Feb09’s actual sales result to the model’s previous forecast estimate (see below).

This percent delta represents the Cowan LRA model’s momentum indicator and is defined as the percent difference between the actual sales for a given month — in this case February’s just released actual global sales of $13.456 billion and the forecasted sales estimate for February, that is, $13.446 billion which was calculated and published last month.

The momentum indicator can be either positive or negative and is a measure of the percent deviation of the actual monthly sales number from its previous month’s prediction which is derived from the model’s linear regression analysis of the past 25 years of historical monthly global “sales experience.”

2. The latest Cowan LRA Model’s full year 2009 global sales forecast estimate is $182.084 billion. It is up very slightly compared to last month’s 2009 sales forecast estimate of $181.896 billion.

In terms of 2008 to 2009 expected sales growth the year-over-year sales growth estimate is projected to be -26.8 percent, which is identical to the previous month’s sales growth forecast number as detailed in the table below (note that quarterly sales forecasts are also presented covering each of the next five quarters along with a sales forecast for next month, namely March 2009).Source: Mike Cowan

NOTE – ALL ITALICIZED NUMBERS ARE FORECASTS.
Sources: WSTS (Actuals) and COWAN LRA MODEL (Forecasts)
NOTE – Jan09 Actual Sales REVISED (SLIGHTLY) UPWARDS TO $13.167B.

Global semi to grow 4.9 percent: Cowan

June 13, 2008 Comments off

This is a new addition to the continuing coverage on the global semiconductor industry forecasts in form of a monthly update to the Cowan LRA Model’s global semiconductor sales forecast numbers.

According to Mike Cowan, an independent semiconductor analyst and developer of the Cowan LRA model, the “momentum indicator” dropped to 1.8 percent from March’s number of 6.1 percent; but still remains in positive territory.

Consequently, the updated forecast numbers increased very slightly from March’s results with the 2008’s sales forecast estimate increasing to $268.249 billion (from last month’s estimate of $267.318; up a modest 0.35 percent) thereby yielding a year-on-year (YoY) sales growth forecast estimate of 4.9 percent (up from last month’s sales growth forecast expectation of 4.6 percent).

This newly updated sales growth forecast estimate of 4.9 percent as per the Cowan LRA model compares quite favorably with both Gartner’s most recent forecast update of 4.6 percent and the WSTS’s Spring 2008 forecast update of 4.7 percent.

Cowan adds: “It should be highlighted that these Cowan LRA Model’s forecast numbers are a “snapshot in time” (for a given month) and will “change” as each new month’s results are made available and digested by the dynamic Cowan LRA Model as the year evolves.”

Cowan LRA model
A new semiconductor sales forecasting model has been developed to facilitate the determination of future global sales of the semiconductor industry. The Cowan LRA (Linear Regression Analysis) Model, which forecasts global semiconductor sales, is a mathematically based model that features statistical analysis of the past 24 years of historical, monthly global semiconductor sales numbers that are collected and published by the World Semiconductor Trade Statistics (WSTS) organization.

Mike Cowan is a 45-year semiconductor industry veteran. He has a 36-year history at IBM’s Microelectronics Division in East Fishkill, N.Y., where he was involved in many facets of semiconductor development and manufacturing engineering, including both technical and management responsibilities.

Over his last 10 years at IBM, as a senior technical staff member, he has been involved in strategy development and competitive analysis focused on the semiconductor industry, and has developed a number of top-down and bottom-up models to predict the dynamics of the semiconductor industry.

After retiring from IBM in 2002 he became an independent semiconductor industry analyst providing his monthly forecasts to The Semiconductor Reporter Web site from 2002-2006, and presently to Future Horizons.

May I also take this opportunity to welcome Mike Cowan on my blog.

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