Worldwide chip sales have slipped deep into the mud over the past year and they’ll continue to do so until year’s end. But they’ll begin to improve after that.

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2009 semiconductor sales are down from 2008 by nearly record amounts, but they’re improving. That’s the latest word from the Semiconductor Industry Association, which said today that global chip sales rose in September from the previous month–the seventh straight month of gains.

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Intel’s year of sequential gains in the semiconductor market came to an abrupt end in the first quarter of 2009. According to market research outfit iSuppli, the chip giant’s share of the market fell 2.5 percent to 79.1 percent in Q1. Meanwhile, AMD’s rose about 2.3 percent to 12.8 percent.

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No big surprises here. The souring economy and related uncertainty in consumer and enterprise technology markets continue to drag the chip sector down into the mud. While world-wide sales of semiconductors in March rose 3.3 percent from February, they were down nearly 30 percent from last year.

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Welcome once more to Weekend Update! I’ll be filling in today for your regular host Beth Callaghan, who’s on vacation. And what sane person wouldn’t be, after the slew of Silicon Valley silliness inspired by April Fools Day this past week? Digital pranks were the name of the game, and Google and others heaped so many tepid hoaxes upon us that we wanted to call April Fold so as to quickly end this round of gags.

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To see just how badly the continuing erosion of consumer confidence is affecting the chip industry, one need only look at the pitiable state of National Semiconductor. After announcing third-quarter revenues that were down 31 percent from the previous quarter and 36 percent from the same period a year earlier, the company said today it would sack more than a quarter of its workforce.

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If life is a cement trampoline, then Fairchild Semiconductor just performed a flat back landing. It’s hand forced by those oft-cited “market conditions,” the company said Friday it is sacking 12 percent of its workforce in an attempt to reduce expenses and spread holiday cheer.

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Macworld 2009 is still about a month away and already, Global Equities Research analyst Trip Chowdhry is frantically turning the hand crank on the rumor mill. In a note to clients today, Chowdhry claims Apple will debut an entirely new device category next year.

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They’re clearing the decks at Cadence. CEO Mike Fister resigned Wednesday, along with four other senior executives, in the wake of mounting financial problems at the semiconductor company.

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If it’s true that “real men have fabs,” as Advanced Micro Devices Inc. Chairman W. J. “Jerry” Sanders III once said, then AMD is the semiconductor industry’s latest eunuch. This morning the chipmaker said it will spin off its manufacturing operations, splitting itself into two companies–one to design chips and one to make them.

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The slow gutting of the U.S. economy hasn’t had as much of an impact on global semiconductor sales; they rose 5.5 percent in August from a year ago bolstered by strong demand for personal computers and handsets. Odd, since you’d assume that slowdown in the U.S. economy would reduce demand for electronics goods and, by extension, the chips on which they run.

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