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Semi Industry Had Record Revenue In '05, Gartner Says

SAN FRANCISCO — Worldwide semiconductor revenue reached a record $235 billion in 2005, surpassing the industry's previous high of $223 billion set in 2000, according to market analyst firm Gartner Inc., which also released its final chip company top 10 ranking for the year (see chart below).

Semiconductor revenue increased 5.7 percent in 2005 from 2004, according to final results for the year, Gartner said.

“Personal computers and cellular telephones remain the largest drivers for semiconductor business,” said Richard Gordon, Gartner vice president of research, in a statement. “The popularity of MP3 players, however, accounted for dramatic growth among flash memory vendors in 2005.”

Final 2005 semiconductor revenue of $235 billion is consistent with what Gartner said when the firm announced its preliminary 2005 revenue numbers last December. However, final 2005 revenue growth of 5.7 percent is below the preliminary revenue growth estimate of 6.9 percent, due to a revision of 2004 total semiconductor industry revenue, which was revised upward to $222 billion from $220 billion. A Gartner spokesperson said via email that the 2004 figure was revised to "reflect a more comprehensive market coverage" and that vendors that were included in the 2005 market coverage were added to 2004 retrospectively.

Gartner's top 10 semiconductor vendor rankings did change between the firm's preliminary results announcement and the final results announcement Thursday (April 13). Philips Electronics NV, which had seemed conspicuous by its absence when the preliminary report was issued in December, actually finished the year in the No. 8 position, an improvement from the No. 9 position it held in 2004, according to the final Gartner report.

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