The semiconductor industry bottomed out in the first quarter and will now grow sequentially for the rest of the year, according to researcher IC Insights.

Revenue of integrated circuit manufacturers totaled $40 billion in the first quarter about 12% less than the fourth quarter of 2008. Sales will grow 7% in the second quarter to $43 billion and another 13% in the third to $48.8 billion in the fourth quarter sales will be $183 billion about 17% higher than the third quarter, says IC Insights.

For the entire year sales will be $183 billion, down about 17% from 2008.

Driving the sequential growth will be cell phone and PC sales. Cell phone shipments also bottomed in the first quarter and will post sequential quarter growth. Within the cell phone segment, sales of smart phones will be strong and with PCs, mini-notebooks will post strong sales to help drive IC sales growth.