Econometric Semiconductor Forecast


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Econometric Semiconductor Forecast

  1. 1. www.linx-consulting.com617.273.8837• 973.698.2331 1The Econometric SemiconductorForecast ServiceProgram Overview & Q1 2013 Report OutMarch 7, 2013
  2. 2. www.linx-consulting.com617.273.8837• 973.698.2331 2Background• Forecasting Semiconductors: A Demand-Driven Approach– The Econometric Semiconductor Forecast Service uses a rigorousstate of the art econometric model system to link global GDPmacroeconomic forecasts to semiconductors. We believe we are the first toprovide forecasts at a quarterly frequency with monthly updates, allowingforecast recipients to plan for short-term fluctuations in the volatilesemiconductor industry.– The Econometric Semiconductor Forecasting Service uses a proveneconometric forecasting process that incorporates measures of economicuncertainty, global economic shocks, and regional volatility to develop aSilicon area forecast for the global semiconductor industry.– Demand-driven equation to forecast of MSI reported by SEMI based on:• Global real GDP growth (from Consensus Forecasts)• US final demand for technology goods (consumer & business), policyindicators, and inventory-shipments ratio, computers• Financial crisis shock indicator to capture panic behavior in latest cycle• The model captures >96% of the long run variation in semiconductors
  3. 3. www.linx-consulting.com617.273.8837• 973.698.2331 3Benefits• Real time data analysis ensures latest trends are incorporated into forecasts• Basing the forecast on Consensus Forecasts provides an outlook of theforecasting community’s consensus view of the global economy• Forecasting conducted through a rigorous statistical process that relates thesemiconductor industry to what is happening in the global economy• Industry knowledge leveraged to make informed adjustments to the model onsuch emerging issues as sequestration• Quarterly forecast, with monthly adjustments• Detailed forecasts on the next four quarters and following two years• Scheduled Webinars to explain the economics driving the forecast and theimplications for our subscribers
  4. 4. www.linx-consulting.com617.273.8837• 973.698.2331 4Quarterly Semiconductor Model• Attempts to look past the “noise” of monthly (and daily) data– Major trends in final demand– Cyclical factors– Statistically significant seasonal factors• Captures about 96% of the long run variation in semiconductors• Two-Part (trend-cycle) demand-driven equation based on:– Global real GDP growth• History: IMF, 97% of world real economy (annual data, distributed toquarters)• Forecast: Consensus Forecasts, Hilltop Economics– US:• Final demand for technology goods (consumer & business)• Policy indicators (Policy Uncertainty Index, short and long term interest rates)• Inventory-shipments ratio, computers– Global financial crisis shock indicator to capture panic behavior in latest cycle• Possible future enhancement: indexes ofeconomic policy uncertainty in Europe and Asia
  5. 5. www.linx-consulting.com617.273.8837• 973.698.2331 5Another Below-trend Year for Global Growth-4-20246959697989900010203040506070809101112131415%ChangeForecastLong-term TrendWorld Real GDP GrowthRelative to 2012: slightly weaker in US; mild recession in Eurozone continues;slightly stronger in Asia, with positive spillovers to other emerging economies
  6. 6. www.linx-consulting.com617.273.8837• 973.698.2331 62013 Global Outlook• Another below-trend year of real GDP growth– Weak in US, below 2012’s estimated real growth of 2.2%– Mild recession in Eurozone continues– Slightly stronger in Asia vs. 2012, with positive spillovers to Latin Americaand commodity-producers• Technology-goods spending rises a little as policy uncertainty recedes– Investment, especially in productivity-related goods– Consumers in emerging countries and, more modestly, in the US• Assumes no major shocks or radical shifts in policy– Europe and US remain “tight” with fiscal spending, “loose” with monetarypolicy– Major Asian economies (China and Japan, especially) stimulate with fiscalpolicy and loosen monetary policy– Economic uncertainty recedes in the second half of the year
  7. 7. www.linx-consulting.com617.273.8837• 973.698.2331 7Q1 2013 Semiconductor Forecast8001,2001,6002,0002,4002,8003,20006 07 08 09 10 11 12 13 14 15SEMI MSIForecastShaded areas indicate US recessionsAnnual Percent Change2009 2010 2011 2012 2013 2014 2015-17.6 39.7 -3.5 -0.1 5.4 9.6 6.5
  8. 8. www.linx-consulting.com617.273.8837• 973.698.2331 88001,2001,6002,0002,4002,8003,200I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV2008 2009 2010 2011 2012 2013 2014 2015Q1 2013 ForecastQ4 2012 ForecastHistory (Through 2012Q4)SemiconductorMSI(Semi)Q1 2013 vs. Q4 2012 Forecast:2012 actual Q4: 2162, -9.5%Forecast Q4: 2197, -8.0%Forecast error: +1.6%Slightly weaker in the first half of 2013, slightly stronger beginning in the second halfof 2013, and healthy growth in 2014 and 2015. (MSI from SEMI)
  9. 9. www.linx-consulting.com617.273.8837• 973.698.2331 9Segment Growth Rates-2,0004,0006,0008,00010,0002011 2012 2013 FMSITotal Silicon Area, and Use bySegmentDiscreteAnalogASICMPUFlashDRAMMSI2011 2012 2013DRAM 1,122 1,122 1,1674% 0% 4%Flash 1,294 1,437 1,66614% 11% 16%MPU 216 231 26135% 7% 13%ASIC 3,430 3,340 3,5743% -3% 7%Analog 1,076 1,043 9700% -3% -7%Discrete 760 722 678-4% -5% -6%
  10. 10. www.linx-consulting.com617.273.8837• 973.698.2331 10Reporting Schedule• The Econometric Semiconductor Forecast Service has two key deliverablesreleased on a periodic basis:– Quarterly Forecasts - will be published 4 times a year (inFebruary, May, August, November) with corresponding webinars– Monthly Updates - which will be published 8 times per year, in theremaining months.• The Publication Schedule for 2013:Release date Output4th week of January 2013 January 2013 Monthly Update7 March 2013 1Q 2013 Quarterly Forecast (webinar)4th week of March 2013 March 2013 Monthly Update4th week of April 2013 April 2013 Monthly Update4th week of May 2013 2Q 2013 Quarterly Forecast (includes webinar)4th week of June 2013 June 2013 Monthly Update4th week of July 2013 July 2013 Monthly Update4th week of August 2013 3Q 2013 Quarterly Forecast (includes webinar)4th week of September 2013 September 2013 Monthly Update4th week of October 2013 October 2013 Monthly Update4th week of November 2013 4Q 2013 Quarterly Forecast (includes webinar)4th week of December 2013 November 2013 Monthly Update
  11. 11. www.linx-consulting.com617.273.8837• 973.698.2331 11Next Steps• Fees & Terms– Cost of the service is $2,900 for a 12 month single user subscription.• Single user subscribers will be allowed to use the material but notforward the forecasts nor have others from their firms sit in on ourwebinars.– An enterprise wide subscription is $11,500 for 12 months.• Enterprise subscribers will not have restrictions on internal company-wide distribution of the newsletters and can have multiple people sit inon webinars from their company.• To Purchase the Service, Please Contact:Mike Corbettmcorbett@linx-consulting.comOffice: +1 973 437 4517Cell: +1 973 698 2331Mark Thirskmthirsk@linx-consulting.comOffice: +1 617 273 8837Cell: +1 774 245 0959
  12. 12. www.linx-consulting.com617.273.8837• 973.698.2331 12Who We AreLinx Consulting LLC• Linx Consulting LLC offers electronic materials consulting services within thesemiconductor, display, compound semiconductor, energy, and nanotechnology segments.Drawing on many years of experience in development, marketing, and consulting LinxConsulting LLC offers unparalleled expertise and capabilities for driving strategic andtactical data generation and decision making for users, specifiers, and suppliers of electronicmaterials.Hilltop Economics LLC• DUNCAN H. MELDRUM, PhD, Chief Economist, is a business economist with extensiveexperience in the application of economics to forecasting and analysis problems. He is afrequent presenter on economic and industry outlooks at major industry events andprofessional meetings.• Meldrum spent thirty years at Air Products and Chemicals, Inc., where as the chiefeconomist he advised the executive team and provided direct support to the operatinggroups. After retiring from Air Products, he spent two and a half years directing the IHSGlobal Insight Center for Forecasting and Modeling, a group that conducted research onforecasting methods and managed the EViews econometric software business. Meldrumestablished Hilltop Economics LLC after leaving IHS to focus on specialized research,consulting and forecasting projects.