The US Semiconductor Industry Association’s chip book-to-bill ratio plunged to 1.11 in September from a revised 1.17 in August – down from a reported 1.18. The fall came not least because the deminator was so large this time around – seasonally-adjusted shipments to the North American market increased to a new high of $4,060m. This figure is 40.1% higher than the September 1994 total of $2,890m and 3.2% higher than the August 1995 figure of $3,930m. Seasonally adjusted orders rose to $4,490m, 44.2% higher than the figure recorded in September 1994, but 2.1% down on August’s $4,580m. The figures caused little surprise because analysts had thought the ratio might go below 1.10. Nevertheless the ratio has not been as low as 1.11 since January and February. September is considered a seasonally weak month for chip orders as factories are just getting back into full production after summer slowdowns. The drop in orders from August could also mean that customers are shortening their lead times, which have extended as much as a year into the future. The ratio in September 1994 was 1.08. Two years ago this number would have been considered spectacular – even last year, Rick Whittington of Soundview Financial Group told Reuter. The order rate is up 44% year over year. That is really strong: I think stocks will bounce on this, he said.
