Tag: growth

Samsung wants to become the world’s biggest acorn upstart

Big acornSamsung has announced plans to adopt a corporate culture akin to a startup saying it wants to be more flexible as growth slows.

Samsung’s executives will sign a pledge to move away from a “top-down” culture and towards a working environment that fosters open dialogue.

The outfit will reduce the number of levels in its staff hierarchy and hold more frequent online discussions between business division heads and employees.

“We aim to reform our internal culture, execute as quickly as a startup company and push towards open communication and continuously innovate,” it said in a statement.

Samsung has been hit by a rapid decline in smartphone profits and the absence of new businesses to drive growth. It has been under pressure to reform its military-style working culture to foster innovation.

It might be a little difficult for the company to change. The system has become pretty entrenched and was helpful while the company was on top. Some analysts warn say there is the risk of Samsung losing its edge as a fast-execution hardware company by attempting to change its ways.

Samsung said it will also cut down on unnecessary internal meetings and simplify reporting procedures in order to improve productivity and offer training to employees to strengthen their “winning spirit”.

Intel predicts modest growth

godzilla_3130893bChipzilla has predicted that it will return to modest growth next year, after seeing a decline in 2015.

It claimed that demand for chips for data centres and other products outside the PC market will help it get back on track.

In a meeting with Wall Street analysts, Intel also announced a dividend increase.

Brian Krzanich, Intel’s chief executive said that Chipzilla would report $55.2 billion in revenue for 2015, in line with Wall Street estimates. That is about one percent less than Intel reported in 2014.

He issued a forecast calling for revenue growth “in the mid-single digit” percentages in 2016. It put its gross profit margin at 62 percent, the same as it projected for all of 2015.

Intel gets most of its revenue from chips for personal computers, a market that has been declining lately. Krzanich said the company has hopes for improved demand in 2016 based on Skylake chips, and Microsoft’s new Windows 10 operating system.

But Krzanich stressed that Intel could grow even if the PC chip business keeps declining, largely because of demand for memory chips and processors used in servers and varied devices represented by a trend called the Internet of Things.

He estimated that non-PC chip businesses currently represent about 40 percent of total revenue but 65 percent of operating profit, because the chips command higher prices.

Intel also projected 2015 capital spending at $10 billion, plus or minus $500 million, including about $1.5 billion on investments to make memory chips. That is an increase over its $7.3 billion projection for 2015.

Ethernet sales reach new height

Global sales of Ethernet switches rose by five percent last year to stand at $21.7 billion.

Why the surge?

According to a report from IHS, it’s all about investments to network infrastructure to satisfy demands by applications.

China showed particularly strong growth last year with revenue up by 17 percent compared to the year before.

Sales of 10GE switches are slowing but even so, port shipments grew 27 percent last year.

But shipments of 40GE ports tripled last year, and revenues doubled.

40GE port shipments were outstripped by 100GE ports – which grew sixfold last year.

And white box switches – often supplied by players including Amazon and Google also showed strong growth.

Cisco only managed to boost its Ethernet switch sales by one percent in the fourth quarter of last year, but IHS thinks the giant company is turning its fortunes round.

2012 a stinker for PC shipment growth

A report from International Data Corporation (IDC) in its quarterly worldwide PC tracker claims that the global PC market should grow a modest five percent throughout 2012, labelling it as likely to be a ‘challenging year’.

383 million PCs should ship in the market this year, according to IDC data. This is a small improvement on the “tepid” growth in 2011. PCs are fighting for their life against alternative devices, but more worryingly, global political uncertainty and a “still bumpy economic roadmap” are also major factors.

IDC points out that there is a threat of a relapse into recession in several markets which, as has been the trend since the global economic downturn, will knock public spending and business confidence.

Because of this, IDC has reduced its outlook for small to medium sized firms. It does, however, maintain some hope that Windows 8 will provide a much needed growth injection into the consumer market, which has been largely disinterested for some time.

That said, questions remain about the exact details for Windows 8: its functions, pricing and release date are all stirring consumer anxiety. As a result, 2012 might not be a bumper year for Microsoft.

The analyst house does expect a new Wintel model swelling growth in 2013 through to 2016, with the company predicting total PC shipments over the period to sail past 528 million units.

According to senior research analyst Jay Chou, the first quarter results were better than predicted. But this was mostly down to the HDD industry realigning its supply chain after the flooding in Thailand.

“PCs continued to face pressure from a weak economic environment and growing competition,” Chou said in a statement. “Consumer sentiment could be revived with Ultrabook or Ultrathin systems, provided the right price is reached. More price-cutting in the Android tablet landscape could free up some budget for PC purchases, but could also focus consumers on tablets rather than PCs. Ultimately, we expect modest PC growth this year as the industry works through the transition to Windows 8 and related devices.”

For the US PC market, most consumers and businesses that need a PC already have one, so the majority do not feel it necessary to upgrade or expand on their devices. Additionally, the presidential elections are adding more stress to consumer and business confidence, as both hold back on spending or hiring. According to David Daoud, research director in Personal Computing at IDC, Windows 8 should bring a new class of product to the plate which “could lead to a stronger refresh cycle” as 2012 closes.

Worldwide, IDC is keeping views “conservative” towards PC buying in mature markets. These are expected to return to growth at some point in 2012. Although the emerging market is offering the most optimism for PC vendors from 2011 up to 2016, as can be seen in the below table, the Eurozone crisis is having a domino effect. Central Europe, Middle East and Africa (CEMA) has had its outlook increased, while the APAC region excluding Japan and Latin America will slow, unable to achieve the same level of growth.

Power management semiconductor market to rake in the cash

Power management semiconductor products are predicted to reach $8 billion in the second quarter of this year according to new research.

Power management semiconductors are used in a broad range of products, with devices ranging from computers, to mobile, to energy systems all requiring management of their electrical supplies

IHS iSuppli has said in a new report that the rise will be an increase of 6.7 percent from the $7.5 billion in the first quarter. It added that the increase also marked the first clear sign of growth since industry revenue plunged sharply at the end of last year after seven straight e quarters of growth.

It said the fourth quarter of 2011, was when things went downhill for the industry when sequential revenue plummeted by 10.7 percent.

Since that quarter, IHS iSuppli said the industry had been static, posting flat revenue at the start of the year but not declining further.

It added that its projected increase for the second quarter was also expected to continue in the second half of this year giving the 2012 power management semiconductor a revenue of around $32.8 billion, up 2.8 percent from the $31.9 billion last year.

Unlike previous years, there were no losses currently predicted for 2012.

The company said the growth was down to a rising emphasis on portable electronic devices, including the booming sales of media tablets and smartphones, which highlighed the importance of power management semiconductors, which were essential for achieving the heat dissipation, weight and size requirements for such products.

It added that the power management market usually experienced a decline in the fourth quarter of each year as part of normal seasonal trends. However, the scale of the contraction in the fourth quarter last year was a serious indication of an especially depressed market for these semiconductors.

According to the company there were a few conditions that had forced this decline. This included the disruption to manufacturing after the Japan earthquake-tsunami disaster in March and then the heavy floods in Thailand during October.

A worldwide slowdown in consumer spending and a pullback in many government-run and supported programs also had a knock on effect.

However, there now seems to be light at the end of the tunnel. As well as predicting growth in this market, IHS iSuppli has also predicted further revenues in areas where power management semiconductors have been strong. This includes the industrial electronics and alternative energy governing wind, solar and geothermal markets.

It said that the leading power management products in the consumer space will be insulated gate bipolar transistor (IGBT) modules, used as a device to switch electric power in many modern appliances. In the consumer segment, power management integrated circuits will be the foremost product driving growth.

Global semiconductor revenue to grow

The global semiconductor market will rake in around $316 billion in revenue in 2012, Gartner has said.

The analyst house has said this is a four percent increase from 2011 and 2.2 percent growth on its previous forecast in the fourth quarter of 2011. 

The rise, according to Gartner, is as a result of the industry being poised for a rebound starting in the second quarter of  this year. It said this was due to the inventory correction finishing in this quarter and lower foundry utilisation rates.

Over in the memory department, Gartner predicts DRAM pricing will improve at the start of the second quarter with a 0.9 percent revenue increase.

This is positive compared to 2011, which the company described as “the worst-performing market,” and saw a 50 percent decline in revenue.  

Elpida’s bankruptcy has also changed the figures with Gartner claiming that this has helped prices rebound. However, it is NAND which is reigning with the research calling it one of the fastest-growing device types in 2012. It predicts revenue for this market will grow by 18 percent this year as a result of a strong increase in mobile devices and solid-state drives. 

Media tablet unit production is also doing well, with a predicted rise of 78 percent, and semiconductor revenue from this sector is said to reach around $9.5 billion in 2012. There’s also an increase in PC unit production, which will rise 4.7 percent bringing in $57.8 billion in semiconductor revenue, while mobile phone unit production is expected to grow 6.7 percent. Around $57.2 billion will be made in semiconductor revenue. 

However, the buoyant market hinges on a few not-so-tiny-things with Gartner claiming that the four percent increase will only remain if European debt stay contained, Iran/Israel tensions stay in check, and there’s solid growth from China.

Gartner could be counting its chickens before they hatch. A recent report by the Semiconductor Industry Association said that semiconductor sales were falling. 

Earlier this month the organisation said it had seen sales slide to $23.1 billion in January, down 2.7 percent from $23.8 billion.

January chip sales were also down 8.8 percent. However, it did say there are signs pointing to recovery and growth as the year went on.

It said this would be driven by an improved US economic outlook and the resolution to the floods in Thailand, the SIA said.

Japanese IT spending heads for double dip with restoration spend

Despite overcoming the negative impact of the global financial crisis and being on-track for another year on the up, Japan’s IT market really isn’t out of the woods.

According to IDC the country could be heading for a “double dip” later on this year as a result of the central government, local government, and corporations making their recovery efforts a priority. The required spend here will mean that many will “postpone non-essential IT spending”, which of course will hit the market hard.

Economic stagnation could be well on the way, says IDC, hurting corporate and consumer confidence. In turn it is having a knock-on affect in spending and IT purchasing to the extent of IT spending freezes.

As TechEye has pointed, the crisis in the wake of the earthquake has also disrupted supply chains all over. Although every effort is being made to restore production levels, there supply shortages of certain components and materials will continue, impacting on electronics such as smartphone.

This has led IDC to predict that Japan’s IT market is being constrained, not only by declining demand but also by limited components supply. Now IDC predicts that Japan’s IT market revenue will project a negative 4.5 percent year-over-year growth.

It gets worse, with all of Japan’s IT market segments – IT services, packaged software, and hardware – expected to experience negative figures compared to 2010.

However, Japan’s overall economy will improve next year as a result of restoration demand and overseas demand from the US and emerging markets.

It is thought that this could have an overall knock on effect on the IT spending market, which could see a year-over-year growth of 3.5 percent as it bounces back from the 2011 decline.

A key to the recovery, according to IDC, will be to resolve the power supply issues in eastern Japan in the mid- to long-term.

Smart meters, smart grid networks, HEMS (Home Energy Management System) and the like are being promoted as ways to resolve some of these problems.

Indian chip design market soars

India’s chip design market is booming, according to India.

According to the India Semiconductor Association (ISA), the country’s chip sector, which focuses mainly in VLSI design, embedded software development and board design, will grow by around 17.3 per cent year-on-year from the $7.5 billion in 2010.

This will amount to earnings of  $8.8 billion in 2011 and $10.2 billion in 2012.

In terms of the demand for the chips, consumer gadgets were found to contribute 34.43 percent to the total demand, while telecom products and wireless entities drove the market by 30.77 percent. Other items driving the demand were chips for cars, LEDs and WiMax. WiMax?

The report estimates that the Indian semiconductor design industry has employed a workforce of 160,000 in 2010. Many were employed in the embedded software sector, which is said to account for 82 percent of employment.

However, ISA president Poornima Shenoy, has said this is not enough. She told Indian reporters that more training and manpower is needed to increase the quality of work churned out and that the sector needs heavy investment from bigwigs to help boost it further.

Back in November Gartner analyst Ganesh Ramamoorthy warned that the Indian semiconductor market was falling behind China and Taiwan, due to low take up of Government initiatives and low incentives.

He said in order to boost its position the country had to team up with China in a bid to become a great power in the semiconductor manufacturing industry.

Last month Intel announced that it would invest $45 million in the country this year, and hinted it had a number of deals in its sights.

External controller-based disk storage hit record revenue in 2010

External controller-based (ECB) disk storage beat other IT infrastructure segments and hit a record revenue mark in 2010.

According to Gartner the industry exceeded its previous high set in 2008 by $1.4 billion in 2010.

The revenue also surpassed $19.4 billion in 2010, an 18.1 percent increase from 2009’s revenue of $16.5 billion.


However, it’s not all good news – with Gartner claiming that although block-access ECB disk storage had an 80 percent share and grew14.9 percent over 2009 in 2010, this large segment grew only 3.4 percent over 2008.

File-access ECB disk storage on the other hand grew 36.2 percent in 2010 over 2009, as well as 37.6 percent over 2008.

EMC increased its worldwide ECB disk storage revenue market share to 28 percent in 2010 and 28.2 percent in the fourth quarter of 2010, while NetApp experienced the strongest growth among the top-tier vendors in 2010 with a revenue increase of 50.9 percent from 2009.

Gartner said that the growth in this industry was down to storage infrastructure modernisation, expanded server and desktop virtualisation projects, disk-based backup and archiving deployments, which were “propelling ECB disk storage vendor revenue growth”.

IT executives were showing a willingness to invest in new and modern ECB disk storage that address complexity, reduce opex and improve utilisation while satisfying demanding service-level agreements.


Semiconductor industry showed growth in January 2011

The semiconductor industry saw a 1.5 percent growth in January from December with sales ramping up to $25.5 billion for the month.

That’s according to research by the Semiconductor Industry Association (SIA), which also found that sales increased by 14 percent. In its Global Sales Report (GSR), a three-month moving average of sales activity, the company also found that the integration of semiconductors has increased across all industries. This includes consumer, automotive, computer, industrial, communications and government applications, which all saw a total growth of 32 percent year-over-year growth in 2010.

However it was the automotive and industrial sectors which fared best here with an increase of 50 percent and 44 percent respectively in 2010. It said some of the growth could be attributed to energy efficient tools and increased automation in industrial applications.

Over in the automotive sector, increased demand for semiconductors was put down to the increase in hybrid and electric vehicles, entertainment applications, engine controls and navigation systems.

The  SIA claims that the industry will “continue to benefit from steady growth, as semiconductor content increases in a wide range of products.”

It said the “impressive growth” in semiconductor sales over the past year had been driven by strong demand across all major end markets.