Semiconductor sales, which have seen decreases so far in 2012, will remain in the red throughout the year, market research firm The Information Network believes.

The semiconductor industry in 2012 through June is currently down 5.4% over the same period in 2011 based on Semiconductor Industry Association's (SIA) 3-month moving average. For this year, the most optimistic forecaster is Semico with a 6-8% growth forecast. IDC is forecasting 4.6%; IHS expects 4.3%; while Gartner and Future Horizons forecast 4% and IC Insights the lowest at 3%. All these organizations are betting on growth of about 10% over the next six months in order to average out a growth they predict.

"We beg to differ," noted Robert Castellano, president of The Information Network. "According to our Proprietary Leading Indicators, which we've developed over the past 17 years, the slight drop in the 3-month moving average according to SIA is the start of a downturn that will last over at least the next three months, and in light of increasingly dour macroeconomic forces, at least through 2012. Our PLLs peaked in the current cycle in February 2012, three months ahead of the peak in the SIA numbers in May 2012."

"We see a continued decline in our PLLs since February followed by the decline in semiconductor sales. Note that our PLLs have consistently predicted the direction of the semiconductor industry by at least 3 months," Castellano said.