Market News

SECAUCUS, NJ -- Starting Nov. 1,  Panasonic Corp. of North America  launched a nationwide program designed to provide consumers convenient recycling of Panasonic brand TVs and other consumer electronics.

Under the program, consumers can drop off Panasonic products free of charge. Panasonic also will work jointly with public and private recyclers, communities, governments, charities and other organizations.

The venture will cover more than 160 recycling drop-off locations in 10 states, and is slated to expand to all 50 states, with hundreds more sites, over the next three years.

In a press statement, Recycling Group manager Richard Vernam, said, "The program will help to move end-of-life consumer electronics out of the common waste stream and into a separate and environmentally responsible recycling stream."

"The focus of Panasonic's new program will be on consumer convenience and environmentally sound recycling," said Yoshi Yamada, Chairman and CEO of Panasonic Corporation of North America. "The new national program both gives life to our customers' recycling expectations and embodies our company's commitment to responsible product lifecycle management."

The move might also signal a larger emphasis on designing products that are easy to break down and reuse.
LOS ALTOS, CA – Although capital investment outlays will slow, the communications equipment industry will survive the economic downturn in reasonable shape, says Henderson Ventures.
 
Worldwide equipment production will slow from a 6.8% rate in 2007 to a 3.2% pace this year, according to the research firm. A further deceleration will take growth rates to 2.7% next year before rebounding to 9.6% in 2010.
 
China is expected to achieve a solid 9.6% gain this year. Even so, that pales before the 19.8% burst chalked up during 2007, says Henderson.
 
During the past few years, the total number of handset subscribers has mushroomed as prices have plunged to meet market requirements in developing countries. But a dwindling unserved market, along with a poor economic environment during 2009, is likely to result in a drop in new subscribers, the company predicts.
 
Handset shipments are slated to decelerate sharply, as the economic environment encourages cellphone owners to postpone the purchase of upgraded handsets. Shipment growth is predicted to decelerate from 15.1% in 2007 through 7.8% in 2008 to only 3.9% next year.
 
And given the increased emphasis on developing markets, handset revenues are forecast to be stagnant next year. The ongoing financial crisis is expected to be resolved by 2010. Rejuvenated economic growth and a new replacement cycle will create a 9.5% unit gain that year.

FRAMINGHAM, MA – According to IDC, the worldwide mobile phone handset shipments are down compared to previous quarters in 2008 and this signals concern for Q4 sales – when mobile phones typically reach peak sales for the year.

Mobile phone manufacturers shipped a total of 299.0 million handsets in Q3 2008, up only 3.2% YoY and down 0.4% compared to Q2 2008. Historically Q3 experiences a ramp-up in sales in preparation for the holiday season. In previous years this ramp up has created an increase in sales of 20% or more in the third quarter.
 
“Handset vendors felt the pressures of the dismal economy in the third quarter of 2008, and as a result, shipments and revenues were down almost across the board,” says Ryan Reith, senior research analyst with IDC’s Quarterly Mobile Phone Tracker.

The market for smartphones, a subset of the overall mobile device market did however posted strong gains for the quarter and continues to dominate the growth in this sector.
 
The industry leader is Nokia with shipments higher than Samsung, Sony Ericsson and Motorola combined. Samsung has jumped in second place, shipping over fifty million units in Q3. Sony Ericsson takes third place worldwide for the first time in its history. Motorola’s volumes were still a fraction of what they used to be and the division posted another quarter of operating loss as the eke out fourth place. Finally, LG Electronics sank into fifth place during the quarter.
SAN JOSE, CA– Tessera Technologies Inc. has released its third-quarter results. Net loss was reported at $5.4 million, or $0.11 per share.
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SAN JOSE -- Worldwide sales of semiconductors rose 1.6% year-over-year to $23 billion in September, and 1.1% from August, the Semiconductor Industry Association said last night.

Year-to-date sales are up 4% to of $196.4 billion. That's 50 basis points lower than the SIA mid-year forecast.

Excluding memory products, September sales grew 7.8% year-on-year. Pricing pressures are having a harsh effect on memory revenues, with flash memory chips down 37.5% year-on-year and DRAMs off 11.1%.
“The rate of semiconductor sales growth slowed in September as the industry began to feel the effects of the turmoil in world financial markets,” said SIA President George Scalise. “We face a near-term period of uncertainty with a steep decline in consumer confidence and caution in the enterprise segment.

"Sales of personal computers and cellphones – the two largest drivers of semiconductor sales – remain strong in these emerging markets, driven by growing consumer populations and rising income levels coupled with more affordable pricing. Economic growth in major developing countries is still high in mid- to high-single digits, albeit below recent peaks.”
Analysts project PC unit sales will grow at least 11.5% this year, with developing countries accounting for nearly half of unit sales. JP Morgan projects 8.7% year-on-year unit growth in cellphone sales, to 1.35 billion in 2008. Again, developing countries are expected to account for nearly 70% of unit sales of cell phones in 2008.
Sales of other consumer electronics including MP3/PMP devices and LCD TVs remained positive through the first nine months of 2008, according to iSuppli. The research firm projects 5% growth for all consumer electronics, with 11% growth for MP3/PMP units and 33% growth in LCD TV units this year. Consumer purchases drive more than half of semiconductor sales.
“Year-to-date chip sales growth of 4% trails the SIA mid-year forecast of 4.5% growth,” said Scalise. “Restoring consumer confidence is key to growing semiconductor sales going forward."
TAIPEIHon Hai Precision Industry (the trade name of Foxconn) reported net profit of $540 million for its third quarter, down 10% year-over-year, but beating market expectations.
 
Forecasts earlier predicted profits of $507 million for the quarter.
 
The world's largest vertically integrated EMS/ODM that's footprint includes PCB Fab manufacturing locations in China did not cite reasons for the decline in earnings.

In July 2008 Foxconn began moving factories from the Shenzhen area to the northern Chinese provinces of Hebei and Shanxi, where lower salaries (60% less than Shenzhen) were expected to help improve company profit.

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