European Semiconductor Distribution (DMASS)
Declines through Summer
DMASS reports a decline of 8.9% in semiconductor revenue in Q3/2019. Germany, France and Italy affected most. Discrete, MOS Micro and Logic shrink double-digit.
London, November 20, 2019 – The summer quarter of 2019 provided a significant decline in sales for the European components distribution market. According to DMASS Ltd., sales in the European Semiconductor Distribution Market fell 8.9% to 2.11 Billion Euro. The first nine months of 2019 still benefitted from a stronger first half and “only” declined by 0.5% to 6.93 Billion Euro.
Georg Steinberger, chairman of DMASS: “A slowdown in customer bookings throughout the year now materialised in a not surprising revenue decline. It is a mix of factors that is driving the slowdown – external and internal – and most of them will accompany us for a while. There is more caution and scepticism in the market than necessary, as we think that the opportunities for technology are still great. We expect the market to return during 2020.”
At country and region level, the situation is rather uneven. While in Q3 Germany, France and Italy declined double-digit, the UK actually grew by 1.6% and Eastern Europe held up with 0.5% growth. Among the major markets, Germany fell by 12.9% to 618 Million Euro, Italy by 13.1% to 168 Million Euro, France shrank by 15% to 132 Million Euro and the UK grew by 1.6% to 159 Million Euro. The Nordic countries (including the Baltic states) only declined by 3.7% to 183 Million Euro, while Eastern Europe grew 0.5% to 380 Million Euro.
Georg Steinberger: “No big change to previous quarters. Countries with a huge share of contract manufacturing continue to grow or at least maintain their momentum, while OEM-driven markets experience a bigger slowdown or lose more business specifically to Eastern Europe, which has a strong contract manufacturing base. The most surprising aspect of this quarter is the resilience of the UK against the current Brexit frenzy.”
Product-wise, the decline spans all technologies and products. However, while Discretes, Standard Logic and MOS Micro declined by double digits in the last quarter, Power, Opto, Memories and Other Logic held up, with a minus between 0.6% and 7.5%. Analog products shrank by 8.65% to 618 Million Euro, MOS Micro went down by 11.7% to 413 Million Euro, Power Discretes declined 2.6% to 241 Million Euro, Opto products by 7.5% to 194 Million Euro and Memories by 6.9% to 195 Million Euro. Other Logic held the fort by a mere -0.6% to 123 Million Euro.
Georg Steinberger: “The quarterly view does not really allow much insight as the situation is different in almost every country. Over the first 9 months however, we see that some areas are over-proportionally weak – like Discretes, Opto, MOS Micro, Standard Logic and Programmable Logic, while Analog, Memory and Power hold up nicely. What is hard to estimate is the impact of suppliers taking business from distribution direct. We know that areas like Analog, Programmable Logic or MOS Micro are affected by it and will be more so in the future.”
2019 almost done and most probably finishing slightly negative, the question is what 2020 will bring. Steinberger: “We believe that we will see more disruptive innovation in the next few years and more opportunities for Distribution.”
DMASS Ltd. reports to members only statistics on Interconnect, Passive Components, Electromechanical Components and Power Supplies (IPE).
DMASS, a European non-profit organisation, is the only industry body that collates detailed semiconductor distribution market data on a quarterly basis by country and product groups such as microcontrollers, flash memories, analog components and many more. DMASS figures are collected and consolidated by Data Dynamics Ltd.
DMASS, founded in 1989, provides its members with a reliable statistical tool to evaluate their relative mass-market performance. The organisation consists of 34 active members in 2019 and represents between 80% and 85% of the total European distribution market, depending on the regions. To continuously increase its European market coverage, DMASS welcomes new membership applications from distributors and semiconductor manufacturers.