The revenue drop underlined a significant year-over-year revenue drop Gartner has predicted for the entire 2009. Semiconductor revenue during the first quarter was US$45.2 billion, a drop from $65.5 billion in last year's first quarter.

Revenue will bottom out by the middle of 2009, with sustained growth expected to start in the second quarter of 2010 when demand for products increases, said Paul Middleton, a research analyst with Gartner.

Worldwide semiconductor revenue is expected to reach US$194.5 billion in 2009, a 24.1 percent decline from 2008 revenue. That could be the worst possible revenue decline that the semiconductor industry has seen since the Internet bubble burst in 2001, when semiconductor sales plummeted by a record 32.5 percent, Gartner has said.

Reduced spending on products like PCs and cell phones has seriously impacted semiconductor revenue, Middleton said. Those products use semiconductors and represent about one-third of the industry's revenue.

Spending on PC products could start recovering after reaching rock bottom in the first quarter of 2009, but that won't fix overall revenue woes. Spending on mobile phones may bottom out in the third quarter of this year, which will continue to have an adverse effect on semiconductor revenue this year.