9th December, 2013

Semiconductor in 2013 and Beyond

2013 has been a prosperous year for the semiconductor market, after a 2.5% decline in 2012.  The Semiconductor Value Chain Service at IHS estimates that global semiconductor sales will reach $317.9 billion by the end of the year, and continue to flourish into 2014.  

This growth has been spurred both by the recovering global economy and the expansion of DRAM and NAND flash memory.  DRAM saw a 35.0% rise this year, while NAND saw growth of 27.7%.  Both of these winners were driven by the continued increase in the sales of smart phones and tablets.  Other growth drivers, according to Electronics News, within the semiconductor industry included LEDs (9.5%), CMOS image sensors (5.7%), standard logic (4.2%), sensors and actuators (3.6%), and analogue application-specific integrated circuits (3.5%).

The main losers within the industry were CCD image sensors (-40.6%), speciality memory (-19.6%), digital signal processors (-16.5%), SRAM (-15.9%), NOR flash memory (-14.8%), and logic ASICs (-11.6%).

The forecast market rankings of 2013 are shown in the table below, provided by IHS.

As mentioned previously, a key component in the growth rate of semiconductor is the GDP of major economies.  The graph from Semiconductor Intelligence shows this relationship very clearly:

As demonstrated by the above graph, both GDP and Semiconductor sales are forecast to increase next year.  As the global market recovers from the financial crisis, the semiconductor will do the same.  

As with any forecasting, there are always different opinions.  Lowest forecast estimate for 2014 according to Semiconductor Intelligence is 2.9% from IDC in July, while the most optimistic is 25%, forecast by Future Horizons in Oct.  The average estimated growth rate is around 10% growth for 2014.  As those in the semiconductor industry know, the industry follows cyclical trends.  This, then, is a positive sign, as it appears that the industry is at the beginning of an upswing.