Global semiconductor inventories down 5% in Q4

http://www.totaltele.com/view.aspx?ID=480072

Intel cut its stockpiles by $585 million in the quarter, according to IHS.

Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc. The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%. "Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker. Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter. Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter. Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Intel cut its stockpiles by $585 million in the quarter, according to IHS.

Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc. The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%. "Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker. Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter. Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter. Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Intel cut its stockpiles by $585 million in the quarter, according to IHS. Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc. The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%. "Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker. Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter. Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter. Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Intel cut its stockpiles by $585 million in the quarter, according to IHS. Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc. The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%. "Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker. Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter. Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter. Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Intel cut its stockpiles by $585 million in the quarter, according to IHS. Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc. The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%. "Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS. No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker. Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter. Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter. Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Global semiconductor inventories during the fourth quarter declined more than expected from the third quarter, led by a 11% reduction by market leader Intel Corp., according to IHS Inc.

The research company said the days of inventory for semiconductor suppliers declined 5% in the fourth quarter, faster than the 1.5% decline initially forecast. Meanwhile, the inventory value fell almost 5%, more than the originally projected 3%.

"Semiconductor companies reduced their inventories at a faster-than-expected rate in the fourth quarter as they moved to adjust to weakening demand," said Sharon Stiefel, analyst for semiconductor market intelligence at IHS.
No. 1 semiconductor supplier Intel was the most aggressive, cutting its stockpiles by $585 million, the largest decrease on a dollar basis of any chipmaker.

Advanced Micro Devices Inc. cut its inventory by $182 million, or 25% from the third quarter, while STMicroelectronics N.V.'s inventory value was reduced by $131 million, or 9% from the prior quarter.

Meanwhile, Qualcom Inc. added $247 million of inventory, a 24% rise from the third quarter.

Qualcomm has benefited from the rising popularity of smartphones. Despite a trend toward internally designed processors, smartphone makers like Apple Inc. and Samsung Electronics Co. have continued to use Qualcomm's modem chips, which employ the next-generation wireless technology LTE.

Texas Instruments Raises Lower End of Sales, Profit Forecasts

http://www.bloomberg.com/news/2013-03-07/texas-instruments-raises-low-end-of-forecasts-for-sales-profit.html

Texas Instruments Inc. (TXN), the largest maker of analog chips, raised the lower end of its forecasts for first-quarter sales and profit, as customers increase orders ahead of a projected rebound in electronics demand.

Earnings will be 28 cents to 32 cents a share on sales of $2.8 billion to $2.91 billion, the Dallas-based company said yesterday in a statement. On Jan. 22, Texas Instruments said profit would be 24 cents to 32 cents on revenue of $2.69 billion to $2.91 billion, and analysts on average predicted 29 cents and $2.81 billion, according to data compiled by Bloomberg.
Texas Instruments has thousands of customers across the electronics industry, from radar-equipment suppliers to microwave-oven makers, meaning its earnings are one of the broadest proxies for the health of the chip market. After running down inventories last year, some companies have resumed buying parts to ensure they aren’t caught short when demand returns, said Tore Svanberg, an analyst at Stifel Nicolaus & Co.
“Order rates are still improving, from obviously a low level,” said Svanberg, who recommends buying the shares. “The industrial market and especially automotive is showing some strength. We’re still very early in the process.”
Texas Instruments shares, which are up 14 percent this year, rose less than 1 percent to $35.20 at yesterday’s close in New York. Many stocks across the analog-chip industry have gained this year on optimism that orders will pick up starting in the second quarter.

Industrial Applications

“In general, the stronger demand environment has continued,” Texas Instruments Vice President Ron Slaymaker said on a conference call with analysts. “Quarter-to-date orders have been growing strongly.”
While demand remains weak for chips used in personal computers and phone-systems equipment, orders are increasing for chips used in industrial applications, Slaymaker said.
In the first quarter of 2012, profit was 22 cents a share on sales of $3.12 billion. Texas Instruments is one of the few companies that still give regular midquarter updates on their progress toward earnings targets.
The company increased its quarterly dividend by 33 percent and added $5 billion to its stock-repurchase program last month. Texas Instruments has an indicated dividend yield of 3.2 percent, according to data compiled by Bloomberg, among the highest in the semiconductor industry.
The chipmaker is in the process of exiting the market for digital chips used in smartphones and tablets, and said on Nov. 14 that it would cut 1,700 jobs as part of that shift. The staff reduction was estimated to pare expenses by about $450 million a year by the end of 2013, Texas Instruments said at the time.

RoHS 2 Creeps Up on the Industry

http://globalpurchasing.com/features/rohs-2-creeps-industry

Gary Nevison and the folks in the element14 community are doing their part to educate the electronics community about the new requirements of RoHS 2, an update to the European Restrictions on Hazardous Substances (RoHS), which took effect January 2. Element14 launched an updated e-book detailing the new requirements, and Nevison may soon be on the lecture circuit delivering that message to suppliers, customers, and others selling electronic components and finished products in Europe. Nevison is head of legislation for Premier Farnell, element14’s parent company, and he says the RoHS update is taking many in the industry by surprise.
“I think there are many areas of industry probably not prepared for this,” explains Nevison, pointing to new requirements for designating products with a CE mark, which means they conform to European standards, in particular.
The new requirements are part of a revision to the RoHS directive, known as the RoHS recast that began in 2010. The new requirements update the original 2006 directive, which banned the use of six substances—lead (Pb), mercury (Hg), hexavalent chromium (Cr (VI)), cadmium (Cd), polybrominated biphenyl flame retardants (PBB), and polybrominated biphenyl ether flame retardants—in eight categories of electrical and electronic equipment. RoHS 2, as it is known, broadens the scope of the directive to include additional products and product categories and makes RoHS compliance a CE directive, placing more data collection work on companies throughout the supply chain.
Some industry watchers say RoHS 2 has fallen off of many companies’ radar screens because it was a much bigger deal due to its newness in 2006. Quite simply, companies have been through it once, are largely familiar with the issue, and have procedures in place to address it. Further complicating the issue for American distributors is local legislation on counterfeit components and conflict minerals that is drawing more immediate attention. But Nevison and others caution against putting RoHS 2 on the back burner as environmental concerns become more acute worldwide and the regulatory climate heats up.
“Make no mistake about it, the authorities will be on this. They will come to check you for these technical files,” Nevison says, pointing to the need for documentation that products comply with European Union directives. He adds that each European state retains the responsibility for enforcing the rules under RoHS 2. “These are the facts. It’s getting more stringent rather than the other way around.”
More Products, More Documentation
Identifying products with a CE mark, which stands for Conformité Européenne (or European Conformity), ensures that they comply with EU regulations. The CE Mark directive places more data collection work on distributors and importers as they seek to verify RoHS compliance, Nevison explains.
“The main impact on industry is the inclusion of RoHS as a CE directive,” says Nevison. “[Companies] need to supply lots and lots of new documentation. The CE Mark is the biggest challenge to us at this point in time.”
In most cases, manufacturers are responsible for documentation and CE Mark designation, but in some instances the responsibility falls to the distributor or importer—especially when the distributor is selling the product under its own brand. The issue is further complicated because the CE Mark now applies to low-cost development boards, which is a sticking point for many manufacturers.
“I think some companies in all honesty didn’t think they needed to comply, but they do,” says Nevison, pointing to differing views over how development boards or kits are classified. “I think what deceives people is that these small, open PCBs don’t look like a piece of finished equipment. But as soon as they’re put in a PC to make them work, if you like, they are classed as finished equipment.”
Development boards that were already on the market before January 2, 2013, do not need to be remarked. RoHS 2 applies to any development boards or kits placed on the market after that date. Nevison says Premier Farnell has been in touch with all of its development kit suppliers to determine their compliance, to varying degrees of success.
“Some say they are in compliance, some say they’re working on it, and some haven’t done anything,” Nevison explains, adding that the issue may lead to distributors dropping certain products.
The other key issue is the broadened scope of the directive itself. RoHS 2 now includes products that depend on electric currents or electromagnetic fields for at least one of their functions. Previously, the directive applied only to products that depended on electric currents or electromagnetic fields to work properly. This widens the field of covered products. Nevison points to two examples: a gas stove with an electric clock and a gas lawnmower with an electric ignition, neither of which was covered under RoHS 1. The gas stove is in scope as of January 2, and the lawnmower will be in scope as of July 2019.
“So it will capture some different products,” Nevison explains. “And it’s worth saying there are lots and lots of exclusions this time. Those will be reviewed by July 2014, and they may even be extended.”
Nonetheless, RoHS 2 has a number of phase-in dates for new product categories. Medical devices and monitoring and control equipment must be in compliance after July 2014, with in vitro diagnostics coming into scope in 2016 and industrial monitoring and control instruments in July 2017. What’s more, RoHS 2 adds an eleventh category in July 2019 when all electrical and electronic equipment not captured in categories 1 to 10 of the directive come into scope.
Nevison emphasizes that revisions are ongoing, noting that the commission overseeing the RoHS directive plans to review more substances next year while also reviewing whether or not further exclusions should be granted.
Robin Gray, chief operating officer for the Electronic Components Industry Association, which represents manufacturers, distributors, and independent representatives in the electronics industry, says the modifications to the RoHS directive are part of a larger trend toward increased regulation worldwide. He points to pending RoHS legislation in China, new U.S. rules surrounding conflict minerals sourcing, varying state-level bans on certain chemicals in the United States, and the simmering concern over the supply of rare earth minerals commonly used in electronics equipment.
“I think the industry’s going to see more and more regulation—environmentally or otherwise,” says Gray. “The other issue is that so much of electronics uses rare earth minerals, and the supply of that is relatively limited—and some very limited. If you’re going to ban certain metals or certain chemicals, how viable are certain components for the long term? You’ve got to find new technologies, processes, or chemical formulas, or you’ve got to be willing to make a trade off. I think this is only going to become more of an issue.”