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New orders for chips wane

Chip makers in the region see book-to-bill figures dip after four consecutive months of growth.

December was a bit of a downer for chips.

Book-to-bill figures for the Americas dropped a tab in December after posting four consecutive months of growth. The industry benchmark compares billings against bookings.

According to figures released today by the Semiconductor Industry Association, the ratio fell to 1.10 for December, down from a 1.16 ratio the previous month. The ratio means that manufacturers received $110 in new orders for every $100 shipped.

Despite the downturn, analysts and industry officials aren't alarmed.

"The bookings decline is relatively small, so I don't take it seriously unless we see another sequential decline," said Rakesh Sood, an analyst with Hambrecht & Quist.

A closer look needs to be taken at the specific sectors and their recovery, he added.

"DRAMs are still hurting overall, but micro-controllers are doing well," he said.

Meanwhile, Doug Andrey, SIA finance director, noted that December results were still higher than levels seen through most of the year. And the SIA remains optimistic about the industry's growth prospects for 1997.

December billings increased 2.7 percent to $3.52 billion for the month, up from the previous month. But bookings declined 2.9 percent to $3.87 billion in December, down from November.

As earlier announced, the December book-to-bill report marks the last one for the SIA. The organization later this month will launch a monthly Global Billings Report that includes global figures, with geographic breakdowns and three-month moving averages that will be used when compiling the figures.

The report, however, will only look at billings and will not include orders booked.