Europe's largest chipmaker, STMicroelectronics, reports signs of upturn
Europe's largest computer chip maker STMicroelectronics is the latest in the industry to report an upturn in demand for it products, potentially an early sign of global economic recovery.
This follows similar statements by Taiwan Semiconductor Manufacturing Company and Intel, saying the upward trend is a good indicator that the worst of the economic downturn is over.
Carlo Bozotti, chief executive of STMicroelectronics, said the company has seen some positive trends over the past couple of weeks, according to the Financial Times.
He said there are signs of re-stocking and order growth, particularly in China, Taiwan, Korea and Singapore and stabilisation in the US and Europe.
But Bozotti said it was still too early to say whether the renewed demand was the start of a sustained recovery or the prelude to a "double-dip" downturn.
"It will be six to eight weeks before we can tell whether it is a trend," he said.
If the positive trend is confirmed, Bozotti said company sales will still take some time to return to the pre-downturn level $2.9bn a quarter, but a recovery to at least $2.3bn is possible within a year.
Like Intel, STMicroelectronics has implemented a set of cost cutting measures in the face of a net loss of £257m for the first quarter of 2009, including cuts of up to 4,500 jobs.
Falling demand for PCs in 2008 has hit several large chip manufacturers, including Intel, AMD, Texas Instruments and Samsung.
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