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AMD becomes chip giant in 2006

ATI acquisition boosts revenue while Intel suffers

AMD and Hynix have made it into the top ten ranking of semiconductor companies for the first time, according to preliminary forecasts for 2006 revenue from research company iSupply.

AMD was helped by strong growth in microprocessor sales, but its acquisition of ATI is the primary reason for its near doubling of sales in 2006, iSuppli said. Its revenue for the year is expected to reach $7.5bn, putting it in seventh place in the worldwide ranking. AMD would have made the top 10 in 2005, but spinning off its Spansion division that year pushed it down to fifteenth place.

For Hynix, strong sales of DRAM (dynamic RAM) and NAND flash memory chips lifted the company into eighth place for 2006, with expected revenue of $7.4bn, up from $5.6bn in 2005, iSuppli said.

Infineon and NEC both lost spots in the top ten. If Infineon hadn't spun off Qimonda AG, it would have moved up from sixth place to fourth for the year. Instead, Infineon moved down to fourteenth place. NEC slipped from number eight to number 11, after a revenue decline of 0.2 percent, iSuppli said.

Intel and Renesas Technology are the only other two companies in the top ten to see their revenue decline. Intel still holds on to the top spot, but declining sales of its microprocessors and NOR flash memory chips are expected to pull revenue down by 11.6 percent for the year, iSuppli said. Intel's divestiture of its XScale mobile phone chip business had only a minor affect on its revenue, iSuppli said.

The other seven companies in the top ten not only grew their revenue, but they beat the overall projected 9 percent growth rate for the industry. Texas Instruments is the standout in the top ten, with revenue for the year expected to grow 19.4 percent.

iSuppli estimates that overall semiconductor sales for 2006 will reach $258.5bn, up from $237.3bn last year.

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