Gartner Shows They’re On the Ball
We have been saying for several months now that semiconductor equipment orders were rising at a rate that the end-demand for semiconductors doesn’t justify. Although the semiconductor stocks briefly plunged, they have recently been acting as though the worst is over. Just in the nick of time, leading industry research firm Gartner has provided their take on the situation.
Gartner lowers capex forecast for ‘06
“Semiconductor capital equipment bookings have continued to surge throughout 2006 as semiconductor manufacturers quickly add capacity,” said Klaus Rinnen, an analyst with Gartner, in a statement. “However, there are a number of concerns for equipment manufacturers, such as an increasing inventory situation, the strong potential for oversupply in both flash and DRAM if an increase in demand does not materialize, and the delta between equipment spending and semiconductor revenue growth. Combined, these conditions create a scenario that could lead to a slight correction next year.”
We never would have guessed.
Disclosure: William Trent has a long position in SMH.
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