From shortage to sluggishness, the semiconductor market experienced a roller coaster ride in 2022.
According to Gartner, global semiconductor revenue inched up 1.1 percent in 2022 to reach US$601.7 billion. The combined revenue of the top 25 semiconductor vendors increased 2.8 percent to account for 77.5 percent of the market.
“2022 began with many semiconductor devices in shortage resulting in extended lead times and increasing pricing which led to reduced electronic equipment production for many end markets. As a result, OEMs started hedging themselves from shortages by stockpiling chip inventory,” said Andrew Norwood, VP Analyst of Gartner.
“However, by the second half of 2022, the global economy began to slow under the strain of high inflation, rising interest rates, higher energy costs and continued COVID-19 lockdowns in China, which impacted many global supply chains. Consumers also began to reduce spending, with PC and smartphone demand suffering, and then enterprises starting to reduce spending in anticipation of a global recession, all of which impacted overall semiconductor growth,” he added.
Samsung Electronics kept the top spot despite revenue decline of 10.4 percent, primarily due to drops in memory and NAND flash sales. Intel, which was second with 9.7 percent market share, experienced significant decline of the consumer PC market and strong competition in its core x86 processor businesses.
Memory, which accounted for around a quarter of semiconductor sales, was the worst-performing device category, shedding 10 percent. By the middle of 2022, the memory market was already showing signs of a significant collapse in demand as electronic equipment OEMs started to deplete memory inventory they had been holding in anticipation of stronger demand.
Conditions have now worsened to the point where most memory companies have announced capital expenditure reductions for 2023, and some have cut wafer production to reduce inventory levels and try to bring the markets back into balance.
Non-memory revenue grew 5.3 percent in 2022, but the performance varied wildly across the different device categories. The strongest growth came from analog with a 19 percent increase, closely followed by discretes, up 15 percent from 2021. The growth for both analog and discretes was driven by strong demand from the automotive and industrial end markets underpinned by secular growth trends in vehicle electrification, industrial automation, and energy transition.
Photo: Samsung
Entelechy Asia 