The Year Past and Year Ahead in Chips

The chip makers had a rocky 2009, no question about it. They make the basic components to products ranging from cell phones to cars and sales of just about everything came to a sudden stop.

But they have weathered the storm, continued to innovate and are going into 2010 with all new products. How will they fare? Hardware Central looks at what they’ve been through and where they are going.

This has not been one of the great years for the economy, although it ended better than it started. Semiconductor companies started out the year in full retreat as spending just stopped dead in the fourth quarter of 2008. The true impact became clear across the industry when grim earnings reports hit in January 2009.

Semiconductors are a good leading indicator of the hardware industry’s relative health, since all finished devices — PCs, servers, printers, smartphones, storage systems — use semiconductors as their base components.

Because of this, many market research firms and financial analysts monitor the chipmakers. If Dell is seeing increased demand for servers or a Chinese supplier is building more laptops, for instance, those firms will be buying more CPUs, memory, and other base components.

And as 2009 progressed, it was the chipmakers who first saw the beginning stages of the recovery. Intel CEO Paul Otellini was one of the first to declare a recovery had started as early as midyear because his company was receiving an increasing number of orders, especially in the month of June.

Read the full story at Hardware Central:


The Year (and Next Year) in Semiconductors