GaAs Downturn Predicted to Not Be as Severe as 2001

Strategy Analytics issued a report “GaAs Industry Downturns 2001 vs. 2009," where the Strategy Analytics GaAs and Compound Technologies service reiterated previous projections of a 5% - 6% drop in GaAs industry revenues for 2009, and explains why the current downturn will not be as extreme for the GaAs industry as in 2001.

As SA said previously, the GaAs industry hit a wall in the last quarter of 2008. The effects of a global economic slowdown finally caught up with the handset market—and other end markets—in which GaAs technology is used. However, Strategy Analytics believes that the expanding demand for bandwidth coupled with better managed inventory corrections will save the industry from seeing the precipitous 25% drop suffered in 2001.