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'04 chip revenue growth strong, '05 weaker! - 8/25/2004 7:04:39 AM   
SiliconFreak


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BOSTON - The semiconductor industry remains on track to record a significant increase in revenue during 2004, according to Gartner Inc.'s latest forecast for the year released Tuesday. After that, however, the outlook takes a turn for the worse.

Chip vendors should take in $226 billion in revenue this year, an increase of 27 percent compared to 2003, said Richard Brown, research vice president for Gartner. But revenue growth will slow considerably next year to between five and 10 percent, and could possibly contract in 2006, he said.

The semiconductor industry is well known as a very volatile business, Brown said. Gartner feels that 2004 has been a very strong year for chipmakers, but the industry can't sustain a 27-percent growth rate as the PC replacement cycle wanes in 2005, he said.
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