NOR Regains Elusive Growth. 2005 Revenues to Hit $7.2 Billion

Semico: The NOR flash market has finally risen above its 2004 doldrums and is poised to grow significantly now through 2006, . NOR revenues, which had been steadily sliding since the second quarter of 2004, pulled forward in the third quarter, and are on a track to grow by 19% in 2006. Semico expects to see the market return in force, with revenues peaking at nearly $13 billion by 2008. The correction that Semico forecast for the second half of 2005 has materialized, reversing 2004’s sharp NOR price decline, the result of a supply/demand imbalance. This market’s demand growth is solid, but 2005 saw a revenue decline that stemmed from an overcapacity. TL leading NOR suppliers, including Intel, Spansion, Sharp, STMicroelectronics, Renesas, SST, Atmel, and Macronix, are experiencing longer lead times and a return to profits. NOR is used in myriad applications, ranging from PCs and peripherals, through consumer electronics devices and into the automotive and telecom spaces, driving this pervasive technology to grow in accord with the penetration of electronics into our lives. The OEMs who consume the world’s flash, including cell phone companies Nokia, Motorola, and SonyEricsson, leading data processing OEMs like Dell, IBM, Apple, and HP, and contract manufacturers like Flextronics, Jabil, Sanmina-SCI, and Solectron, are seeing small price increases and a return to more healthy lead times. Although changes like this are inevitable, this report helps these users to properly time transactions around market cycles. NOR Turns the Corner: Third Quarter 2005 Pricing & Forecast. Publ. 20051121