TV chips seen poised for growth after rough Q1

Due largely to a weak first quarter, TV chip revenue is expected to decline to $7.6 billion in 2009, down 15.4 percent from 2008, iSuppli (El Segundo, Calif. said).

First quarter TV chip revenue was about $1.55 billion, down 4.1 percent from the fourth quarter of 2008 and down a whopping 41.3 percent from $2.6 billion in the first quarter of 2008, according to the firm.

ISuppli said it expects second quarter TV chip sales to be up more than 20 percent from the first quarter, with continued growth expected in the third and fourth quarters as inventories are restocked.

"Sales of higher-end televisions models with the latest features struggled in the first quarter, impacting shipments of higher-priced advanced semiconductors," said Randy Lawson, senior analyst for DTV and display electronics for iSuppli, in a statement. "Meanwhile, smaller-screen, less feature-rich sets are expected to expand their share of total television unit sales. This caused revenue from shipments of television semiconductors to decline."

But long-term growth for the TV chip sector looks promising, iSuppli said, thanks to the rise of LCDs and continuous increases in the capabilities of sets.

"LCD-TVs will account for 91 percent of worldwide television semiconductor revenue by 2012, up from 62 percent in 2008," Lawson said. "This shift in display technology will provide room for the semiconductor content to grow due to the higher electronics requirements for LCD-TVs compared to CRTs."

Lawson's latest report, " DTV Semiconductor Market Remains Hopeful Amid Struggle for Stability," is now available for sale through iSuppli's website.

DisplaySearch Inc. this week issued TV chip vendor rankings, which showed that Broadcom Corp. jumped into the top five among suppliers following its acquisition of Advanced Micro Devices Inc.'s digital TV chip unit last year.