1Q’09 (not surprisingly) was a difficult quarter for electronic equipment manufacturers. OEM revenues dropped 12% compared to the first quarter of 2008. Market sector performance was very poor with only military electronics showing 1Q growth. Fortunately inventory levels are “reasonable” considering the magnitude of our current recession. Inventories/sales ratios for the electronics food chain are all higher than in 2008, but certainly under much better control than compared to the “2000 bubble” era.

Geographically electronic equipment “growth” is negative for all major regions. Japan is having the most difficulty. The USA has seen a more modest downturn (thanks to its focus on less volatile electronic equipment sectors—military, medical and instruments & controls). Taiwan/China saw an unprecedented in magnitude post Christmas holiday downturn. Its normal seasonal low in January was made MUCH worse by much weaker global demand for consumer and business electronics (resulting in sharply lower SE Asian exports).

Read the full column, with charts, online.