Power management IC market to contract in 2012, says IHS

Press release; Jessie Shen, DIGITIMES [Friday 7 December 2012]

The market for power management semiconductors crucial to energy savings in a wide range of devices now is predicted to decline by 6% in 2012, due mostly to pronounced softness in the global consumer market, according to IHS iSuppli.

Revenues derived from the use of power management chips will amount to US$29.9 billion by the end of 2012, down from US$31.8 billion a year ago, IHS said. In comparison, the industry posted a small 1.5% increase in 2011, from revenues of US$31.4 billion in 2010.

The previous IHS forecast for 2012, issued in September, called for slight 1.7% growth for the market.

"The decline this year comes on the heels of a general slowdown in consumer spending all over the World," said Marijana Vukicevic, senior principal analyst for power management at IHS. "Despite the popularity of devices like smartphones and tablets, the consumer markets as a whole remain soft, with specific segments, like notebooks and other computer platforms, registering perceptible slowdowns."

Also contributing to the overall decline this year of the power management space is a deceleration of energy initiatives in Asia, IHS noted. Government incentives encouraging improved-efficiency cooling systems for residential and commercial use have expired, but new replacement stimulus efforts never took place in 2012.

The market for power management chips is set to return to growth in 2013, at a projected 7.6% increase to US$32.2 billion, IHS forecast. A modest rate of expansion ensues after that for the next three years, with industry revenues reaching an estimated US$38.7 billion by 2016.

The need for better power management in most present-day equipment will drive the industry moving forward, IHS pointed out. Key markets for power management semiconductors in the future will be mobile devices, communications, energy and public infrastructure improvements and new construction. An especially potent market lies in alternative energy, especially in hybrid and electric vehicles, wind and solar energy, and grid upgrades for smart meters and similar devices. Medical electronics will also spur demand through diagnostics, monitoring and various human-aid products.

Source: IHS, compiled by Digitimes, December 2012