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Renesas Makes Major Gains in Multimedia Coprocessors in 2007

Riding a wave of demand for increased multimedia and computing horsepower in mobile handsets, Renesas Technology Corp. achieved nearly a 320 percent increase in multimedia coprocessor revenue in 2007, putting the company in contention with Texas Instruments Inc. for leadership in the market.

Renesas of Japan attained stand-alone coprocessor revenue of $665 million in 2007, up 318.2 percent from $159 million in 2006. Company market share in this segment rose to 18.4 percent for the year, up from 4.8 percent in 2006.

In contrast, longtime market leader Texas Instruments of the United States suffered a 5.8 percent decline in revenue, with sales decreasing to $801 million, down from $850 million in 2006. This gave Texas Instruments a 22.2 percent share of market revenue, down from 25.7 percent in 2006.

Figure 1 attached presents iSuppli’s preliminary estimate of worldwide revenue market share in 2007 for the Top-5 suppliers of stand-alone multimedia and applications processors for the mobile-handset market.

Disintegration is in

iSuppli’s preliminary 2007 estimate for global market for stand-alone coprocessors for mobile handsets calls for revenue to rise to $3.6 billion, up 9.2 percent from $3.3 billion in 2006. In contrast, the overall market for wireless application-specific wireless semiconductors grew by only 7.6 percent in 2007, according to iSuppli’s preliminary estimate.

“If you think that the future of mobile-handset semiconductors lies in single-chip solutions alone, think again; revenue for stand-alone coprocessors that are not integrated into the digital baseband is outgrowing the application-specific wireless semiconductor market as a whole,” said Francis Sideco, senior analyst, wireless communications, for iSuppli.

“Due to the multimedia revolution that drove higher-than-expected handset sales in 2007, the market for stand-alone multimedia and applications processors in handsets continues to achieve strong growth. Consequently, this segment is providing major opportunities for some companies focused on that space.”

Coprocessor competition

Indeed, the growth of the coprocessor market has promoted more vigorous competition among semiconductor suppliers—and may spur future price declines.

“In a market that traditionally had been dominated by a single company, Texas Instruments, the emergence of a strong No.-2 in Renesas as well as the impressive growth of other companies speaks to the opportunities available in this area,” Sideco said. “Aside from the continuing need for stand-alone multimedia processing capability, the added competition also should spur innovation and potentially lower Average Selling Prices (ASPs), further driving growth.”

Illustrating the intensity of competition in the market, MtekVision and nVidia both are expected to post revenue growth of approximately 50 percent in 2007, according to iSuppli’s preliminary estimate.

For more information, please contact:

Jonathan Cassell
Editorial Director and Manager, Public Relations
iSuppli Corporation
Office: 408.654.1714
Mobile: 408.921.3754

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