By Li Panpan

(JW Insights) Jul 11 -- China ranked first in month-on-month growth of global semiconductor sales in May, registering $11.9 billion and up by 3.9% month on month, showed the data from the Semiconductor Industry Association (SIA) on July 6.

The global semiconductor industry sales totaled $40.7 billion during the month of May 2023, an increase of 1.7% compared to the April 2023 total of $40.0 billion but 21.1% less than the May 2022 total of $51.7 billion, said SIA.

“Despite continuing market sluggishness compared to 2022, month-to-month global semiconductor sales inched upward in May for the third consecutive month, sparking optimism for a possible market rebound during the second half of the year,” said John Neuffer, SIA president and CEO.

Regionally, month-to-month sales increased modestly across all regions: Europe (2.0%), Asia Pacific/All Other (1.3%), Japan (0.4%), and the Americas (0.1%).

Morgan Stanley Securities’Greater China semiconductor report said that the industry is currently at the bottom of a U-shaped recovery, and the next upward cycle is expected to start in the fourth quarter of this year, mainly due to long-term driving forces of technology currency tightening and AI demands.

The US broker upgraded the semiconductor sector in China to attractive from in-line. It recommended that investors should not only pay attention to the downward trend in 2023 but focus on the upward cycle in 2024.

Except for a few companies disturbed by structural problems, most Asia-Pacific semiconductor companies are expected to see annual revenue growth of 10% or more next year with improved operating margins.